Ilirija d.d.

Environmental & Social Information • Jun 30, 2025

SUSTAINABILITY REPORT FOR THE YEAR 2024

Biograd na Moru, June 2025

1 INTRODUCTION BY THE PRESIDENT OF THE MANAGEMENT BOARD

2024 Sustainability Report 6

4 OPERATING RESULTS IN 2024

4.1 Management of the Economic
Aspect of Business
4.2 Operating Results in 2024
4.3 Publications Under the
Taxonomy Regulation

2 ABOUT ILIRIJA d.d.

2.1 Basic Data	9
2.2 Ilirija in Figures	10
2.3 Chronological Overview of the
Historical Development of Ilirija
2.4 External Initiatives and	15
Membership in Associations
2.5 Overview of Portfolios,
Products and Services
2.6 Market, Customers and Suppliers	36
2.7 Standards and Certificates	46
2.8 Awards and acknowledgements	48
2.9. Significant Events	49

5 CORPORATE ENVIRONMENTAL RESPONSIBILITY

5.1 Environmental Management	123
5.2 Education and Activities	126
5.3 Investment in the Environment	127
5.4 Energy	128
5.5 Water	136
5.6 Effluents and Waste	140
5.7 Compliance with Environmental	143
Protection Regulations
5.8 Horticultural and Spatial Design	144

Table of content Sustainability report for the year 2024

3 BUSINESS MODEL FOR THE SUSTAINABLE DEVELOPMENT OF ILIRIJA D.D.

3.1. Business Model Description	51
3.2 Company Business Model	52
and Sustainability
3.3 Sustainable Business Strategy	53
3.4 Vision, Mission and Fundamental Values	59
3.5 Contribution to Achieving the UN	60
Sustainable Development Goals
3.6 Corporate Governance and	63
Organisational Structure
3.7 Risk, Risk Management and Opportunities	68
3.8 Dialog with Stakeholders	82

6 CORPORATE SOCIAL RESPONSIBILITY

146
160
165
168
183
188

87

88 116

1 INTRODUCTION BY THE PRESIDENT OF THE MANAGEMENT BOARD

3

1 Introduction by the president of the Management Board

In 2024, we continued growing our business activities, achieving the best results at the Company level and across its sectors. Taking into account the circumstances in which the business year took place, primarily the unfavourable global macroeconomic and geopolitical environment, the spread of geopolitical instability, the slow recovery of leading European economies and strong inflation, the full recovery of competitive tourist destinations in the Mediterranean with a continued pronounced lack of qualified labour, the growth of key business indicators, some of which are the best to date, significantly contributed to strengthening the Company's financial stability and resilience, its competitiveness and economic viability.

Total revenue was generated in the amount of EUR 30,685,992.57, with an increase of 8% compared to the previous year, while operating revenue amounted to EUR 30,351,531.83, as a result of the growth of business activities at the level of all Company sectors. The business year was significantly marked by the strengthening of the year-round business primarily through the destination management company, whose revenue increased by 43%, followed by the hotel sector with revenue growth at a rate of 9%, which was simultaneously accompanied by revenue growth in other sectors, namely the nautical sector with a growth rate of 9%. Revenue in the real estate sector increased by 5%, while the camping sector achieved revenue growth at a rate of 3%.

Furthermore, the Company recorded growth in key business profitability indicators (EBITDA, EBIT, operating profit, profit before tax and net profit), while some profitability indicators are the best to date. EBITDA was realised in the amount of EUR 8,120,672.86, a 4% increase, while EBIT amounted to EUR 4,896,264.66, constituting an increase of 7%, while operating profit was realised in the amount of EUR 7,786,212.12, representing an increase of 3%. Profit before tax was realised in the amount of EUR 4,434,043.96 at a growth rate of 9%, while net profit amounted to EUR 3,576,074.33, representing an increase of 9% compared to the previous year.

The achieved business results have further strengthened the Company's capital position, expressed through capital growth, while simultaneously reducing total liabilities and net debt, which recorded an 83% decrease. We have continued reducing our liabilities, especially in terms of net debt, which was the lowest to date, with an increase in the self-financing rate, i.e. further strengthening the Company's overall capital, financial and balance sheet position.

The business results were the result of continuous and long-term investment in a quality, recognizable and sustainable tourism offer, which, on the other hand, has enabled us as a Company to create added value for all our stakeholders. In 2024, business activities in the pre- and post-season increased significantly, thus achieving one of the Company's fundamental goals – strengthening its business activities outside the main season, i.e. developing a year-round tourist offer with a strong contribution to strengthening the tourist offer of the destinations in which it operates, as well as the tourist offer of Zadar County and Croatian tourism in general.

In 2024, in the segment of human resources management, we undertook a series of activities ensuring the optimal number of employees for the business year through: employment of qualified and professional employees, timely employment of seasonal employees, maintaining a high rate of returning seasonal employees and actively taking care of improving their material rights, which is one of the main objectives of the Company in terms of HR policy. We are actively working to improve the financial position of our employees, therefore the average gross salary for 2024 amounted to EUR 1,675.00, recording an increase of 9% compared to the previous year, i.e. 23% higher than the average gross salary paid in the accommodation and catering industry in the Republic of Croatia for the same period. Moreover, the majority of our employees come from Zadar County, i.e. 93% of them at the end of the reporting period, 75% in the main season, retaining employees from the local community while further developing year-round business activities is one of our fundamental goals. In 2024, we continued our contribution to community development through cooperation with domestic suppliers, with whom we achieve 95% of our turnover, while supporting the wider community through numerous corporate philanthropy projects and activities aimed at developing the destination's tourist offer.

At Company level, we designed and directed our activities in 2024 towards the development of sustainable and responsible products and services that strengthen our own viability as a business entity with strong economic and social contributions to the wider community, which we will continue to do in the future, while placing particular emphasis on continuously balancing the rights and interests of our key stakeholders.

Goran Ražnjević President of the Management Board

2024 Sustainability Report

The 2024 Sustainability Report refers to the period from 1 January to 31 December 2024, and relies in part on the Annual Business Report for 2024, published in February 2025 in the Croatian and English language on the Company website, www.ilirijabiograd.com, as well as on the websites of the Zagreb Stock Exchange and the Croatian Financial Services Supervisory Agency (HANFA).

This is the Company's ninth report that combines information on key financial indicators of business with non-financial information and the Company's activities in the field of environmental protection, relations with employees and the community.

The Company reports on key performance indicators in accordance with the Taxonomy Regulation, as well as in accordance to the guidelines of the GRI standards: Core Option.

Please send your comments, as well as suggestions for improvement, to the following e-mail address: jasminak@ilirijabiograd.com

Contact person: Jasmina Kulaš Stojanov, Expert Team Coordinator, Tina Ujevića 7, 23 210 Biograd na Moru.

2.1 Basic data

Company name: Ilirija, public limited company for hospitality and tourism Location of the organization's registered office: Tina Ujevića 7, Biograd na Moru, Republic of Croatia Phone number: +385 23/383 165 Fax: +385 23/384 564 Web: www.ilirijabiograd.com PIN: 05951496767 Company registration number: 3311953 IBAN: HR5824020061100097324 Swift: ESBCHR 22 Share capital amount: EUR 30,420,000.00 Total number of shares: 2,413,488, with no par value Management Board: Goran Ražnjević, President Supervisory Board: Goran Medić, President

2.2 Ilirija in numbers

Ilirija is a tourism company that has already been doing business on the Croatian tourism market for 67 years, and its facilities are located in Biograd na Moru, Zadar, Sv. Filip i Jakov i Polača, and does business in five segments of offer:

Business results in 2024 and a comparison with 2023:

+8	+9	+4
%	%	%
TOTAL REVENUE	NET PROFIT	EBITDA
30.685.992,57 EUR	3.576.074,33 EUR	8.120.672,86 EUR
-9	+3	-83
%	%	%
TOTAL LIABILITIES	CAPITAL	NET DEBT
16.862.887,68 EUR	54.693.348,46 EUR	539.116,87 EUR
+16 % MARKET CAPITALIZATION 72.404.640,00 EUR	+2 % REALIZED OVERNIGHT STAYS 720.383	+4 % NO. OF EMPLOYEES SEASON PEAK 440

2.3 Chronological Overview of the Historical Development of Ilirija

1957

Ilirija d.d. was founded in Biograd na Moru, where it still does business, even though the company's beginnings date back to 1934, when the first hotel called ILIRIJA was built. Those were also the beginnings of organized tourism of the entire Biograd Riviera, making the Company the pioneer and leader of the entire tourist activity in the region around Biograd.

1969 - 1972

Construction of new hotel facilities (the Kornati Hotel**** and the Adriatic Hotel***), complete reconstruction, i.e. construction of the Ilirija Hotel**** and upgrading of Villa Donat****/*** in Sv. Filip i Jakov.

1976

Start of construction of the first nautical tourism port in Croatia, the Ilirija-Kornati Hotel Port located in Biograd na Moru, with a total of 100 berths, and acquisition of the first charter fleet with 40 vessels, which made the company the pioneer of nautical tourism development.

1986

Extended nautical capacities following the construction of the Marina Kornati Nautical Tourism Port located in Biograd na Moru, with a total port surface area of 131,600 m2 (waters) and a total capacity of 705 berths at sea and on land.

1988

Construction of the Aquatic Centre as a swimming, beach, sports, entertainment and restaurant facility, with stands having a capacity of 4,000 seats and with a 1,000 m2 terrace, as the centre of almost all sports, entertainment and dance events of the destination. Construction of a 48,000 m² tennis centre with 20 tennis courts.

1991 - 1992

Completion of the remaining part of the port area, i.e. increasing the capacity of the Marina Kornati Nautical Tourism Port by building piers in the southern and western waters.

1999

Ilirija d.d. was privatized and is now majority-owned by Arsenal Holdings d.o.o. from Zadar, which is in majority ownership of Mr Davor Tudorović. The Biograd Boat Show nautical fair was launched, originally organized as spring Open Days, and then as the first autumn nautical fair in Croatia as of 2004.

2002

The State Audit Office audited the conversion and privatization of ILIRIJA d.d. and issued a positive Opinion on the conversion and privatization process in its entirety, emphasizing that the process was carried out in accordance with legal regulations and that no irregularities were identified, which would affect the lawful implementation of the transformation and privatization process.

1989

Construction of an annex to the Kornati Hotel**** and the Company's administrative building.

1993

The Croatian Privatization Fund adopts decisions on the conversion of HTP Ilirija into a public limited company.

2000 – 2024

During this period, i.e. as at 31 December 2024, the Company invested EUR 92,762,435.31 inconstruction, reconstruction, extension, upgrading, renovation and adaptation of accommodation facilities and establishments of the Company in order to enhance the quality, improve the overall service and standards in all sectors of the Company, develop new products, improve and increase the categorization of the accommodation facilities and nautical capacities, expand hospitality facilities with an aim to create a high-quality, recognizable and competitive tourism product and enhance the quality of the offer of the destination itself together with the purchase of the City Galleria Business and Shopping Centre, which resulted in a growth in total revenue and newly created value in the mentioned period in the amount of EUR 182,869,201.93.

2003

Ilirija's shares were listed on the Zagreb Stock Exchange, on the Listing of Public Limited Companies.

2005

The business system of Ilirija d.d. includes the multimedia centre Arsenal in Zadar, built in the 17th century, which started doing business following the implementation of the revitalization and renovation in accordance with the concept of the "indoor town square".

2014

The "Nada" event yacht, a multi-functional floating congress centre with a length of 36 m and capacity for 180 people, was presented. As part of the business system of the company, the first Croatian diffuse hotel Ražnjevića Dvori AD 1307, was opened in the town of Polača.

2015

Villa Primorje****, built in the second half of the 19th century, was renovated, luxuriously decorated and equipped in accordance with the latest standards for facilities of its kind and category.

Recapitalization of the company by Allianz ZB d.o.o., a mandatory pension fund management company established in Zagreb, which acquired 10% share in the company.

2015 - 2017

The investment cycle in Marina Kornati is mostly completed through the improvement of the quality of vessel accommodation by modernizing almost 70% of the Marina's superstructures and substructures, i.e. piers, which further strengthened the market position of Marina Kornati among the three leading nautical tourism ports on the Adriatic.

2009

Company shares are listed on the Regular Market of the Zagreb Stock Exchange

2015

The company's shares transferred from the Regular to the Official Market of the Zagreb Stock Exchange, which contributed to an even greater transparency and openness of the company to all its stakeholders, especially to the investment public, as well as the domestic and international capital markets.

2016

The second recapitalization was successfully realized by increasing the share capital by contributions in cash, namely through the issuing of new ordinary shares of the company by public offering. The main purpose of recapitalization was to raise funds for the purchase of the City Galleria Business and Shopping Centre in Zadar.

2018

Construction of an indoor swimming pool with a usable area of approximately 500 m2, along with accompanying facilities.

2.4 External Initiatives and Membership in Associations

Ilirija is a member of the following national and international business and professional associations:

A member of 14 business and professional associations

An active promoter of the interests and development of the tourism industry by actively contributing to the regulations of special importance and interest to tourism

A promoter of activities pertaining to corporate responsibility and sustainability

Business associations:

• Croatian Chamber of Commerce (HGK) Association of Croatian Marinas Community for corporate social responsibility Community for Environmental Protection Economic Council of the Croatian Chamber of Commerce in the Zadar county
• Croatian Employers' Association (CEA)
• Croatian Business Council for Sustainable Development (HR BCSD)

The President of the Management Board of Ilirija, Mr. Goran Ražnjević is a member of the following bodies of business and professional associations:

• Assembly of the Croatian Chamber of Commerce
• Tourist Council of the Zadar County Tourist Board
• General Assembly of the Croatian Business Council for Sustainable Development • Gender Equality Federation 4 codes/charters/initiatives

Professional associations:

• Association of Employers in Croatian Hospitality (UPUHH)
• Croatian Tourism Association (HUT)
• Croatian Camping Union (CCU)
• Top Camping
• Association of Croatian Travel Agencies (UHPA)
• Croatian Association of Independent Travel Agents (CAITA)
• Croatian Association of Congress Tourism Professionals
• Tourist boards at the regional and local level
• International Federation of Boat Show Organisers (IFSBO)
• Association Lijepa Naša
• LAG LAURA

Charters, codes and initiatives implemented by the company:

• Corporate Governance Code of the Croatian Financial Services Supervisory Agency and the Zagreb Stock Exchange
• Code of Business Ethics of the Croatian Chamber of Commerce
• Diversity Charter Croatia

2.5 Overview of Portfolios, Products and Services

The portfolio of Ilirija d.d. covers all key segments of the Adriatic Mediterranean tourist offer, that is: the hotel sector (hotels: Ilirija****, Kornati****, Adriatic***, Villa Donat****/***), the nautical sector (Marina Kornati and Ilirija-Kornati Hotel Port), camping ("Park Soline" camp****), the destination management company / DMC Ilirija Travel (Arsenal, diffuse hotel Ražnjevića Dvori AD 1307, event boat "Nada", Villa Primorje), the sports-recreational and entertainment facilities (Ilirija Tennis Centre with 20 tennis courts and the Aquatic Centre with a catering facility) and the real-estate segment (City Galleria Business and Shopping Centre in Zadar). An integral part of the offer within the tourism sector of the company are also restaurant facilities with food and beverage offers and services (restaurant "Marina Kornati", restaurant "Park Soline", Beach Club Ilirija, Lavender lounge bar and "Donat" beach bar).

The company's business is based on the provision of services by using its facilities (hotel, nautical and camping facilities), while also providing additional amenities and services, thus creating a high-quality integrated and complementary tourism product on the domestic and international tourism markets, presented under the Ilirija Travel brand. The destination management company was established as a response to the tourism demand of today, based on technological, social and market factors and trends, and aimed at meeting the needs of the increasingly demanding guests and the market.

Overview of the Capacity of Ilirija d.d.

,

of 4,000 persons

Hotel Sector

4 hotels

The hotel sector of the company is operated under the brand ILIRIJA RESORT, and it consists of four hotels with a total capacity of 910 beds and 435 rooms:

The Ilirija Hotel is the largest four-star hotel of the Ilirija Resort, with a capacity of 157 rooms and 326 beds, equipped with a 200-seat restaurant, a terrace with 70 seats and an aperitif bar with 50 seats. The newly renovated wellness centre covers the entire fifth floor of the Ilirija Hotel, and together with the area of the indoor pool and the wellness beauty zone on the ground floor of the hotel, occupies an area of 2,000 m2. It is located by the seashore, right next to the old town centre, and it is surrounded by beautiful nature, the sea and a pine forest, as well as numerous facilities offering various amenities. All nearby beaches have been awarded a Blue Flag, which certifies the quality of the sea and the associated beaches.

The design and atmosphere of the four-star Kornati Hotel, with a capacity of 106 rooms and 230 beds, also featuring a restaurant having a capacity for 220 people, a terrace for 50 and a bar for 40 people, is linked to and evokes the images of the most beautiful Croatian national park The Kornati Hotel is also unique for its connection with the hotel marina, which is located in the very centre of Biograd, with a beach right next to the hotel – which makes this hotel absolutely unique on the Adriatic coast.

The three-star Adriatic Hotel has a capacity of 100 rooms and 210 beds, a restaurant with a capacity for 230 persons, a terrace with a capacity for 300 persons and a bar with a capacity for 110 persons. The hotel also has an outdoor pool. It is located in a pine forest, almost on the beach, and right next to the hotel is the Aquatic Centre, ideal for family fun and for various attractive summer sea activities. The Adriatic Hotel boasts a modern design inspired by the ancient medicinal herb lavender, which is characteristic for Mediterranean landscapes.

910 beds

435 rooms

The Villa Donat Hotel is located in the picturesque town of Sv. Filip i Jakov, and it consists of a villa with 16 superbly and modernly furnished rooms. It is a four-star hotel, and it has a three-star annexe. Its total capacity includes 72 rooms and 144 beds, a restaurant with a capacity of 120 seats, a terrace for 50 and an aperitif bar for 20 persons, and from 2017 it has an outdoor pool. The hotel is located near the main beach and the town centre, and it is reminiscent of the rich history of the area. Boasting a modernly furnished villa and an atmosphere reminiscent of the old times, a restaurant and a bar with a terrace surrounded by Mediterranean vegetation, this hotel is perfect for a real family holiday.

Within the Ilirija Resort there is a conference centre consisting of 8 halls, with a total capacity for 30 to 250 people, and there is also a luxurious garden with terraces ideal for banquets, receptions and entertainment, as well as outdoor swimming pools, a beach and an indoor pool.

20

Nautical Sector

Pioneers of nautical tourism development in Croatia

Marina Kornati – a marina with a four-anchor rating

Biograd Boat Show - the largest international nautical fair in Croatia and South East Europe

In 1976 Ilirija d.d. built the first nautical port in Croatia, the current hotel port, from which nautical tourism began to develop all over the Adriatic, and the first charter fleet consisting of 40 Elan vessels, which is why the Company fully deserves its title of pioneer of nautical tourism, whereas Biograd became the cradle of nautical tourism.

The Company's current nautical sector consists of Marina Kornati and the Ilirija-Kornati Hotel Port, with a total of 805 berths at sea and on land, which can accommodate up to 2000 boaters in one day, and its number of berths, modern technical equipment, quality of service, cleanliness and neatness make Marina Kornati one of the three leading Croatian marinas, visited by over 60,000 boaters a year.

The four-anchor Marina Kornati is one of the largest nautical ports in Croatia with a total sea surface area (waters) of 91,912 m2 and a land surface area of 39,688 m2. The Marina Kornati waters consist of: (I) the central waters with 365 berths at sea and 70 berths on land, (II) the western waters with 190 berths at sea and (III) the southern waters with 80 berths at sea.

In addition to its own service zone for repairs, vessel maintenance and dry docking, the marina offers a 24 hour navy-guard service, a parking lot with 500 parking spaces, as well as restaurant facilities. There are about fifty external companies operating within the marina, which, within the framework of business cooperation, offer servicing and supply the boaters with the necessary equipment.

The Ilirija-Kornati Hotel Port, located in the very heart of Biograd na Moru, in front of the Kornati and the Ilirija hotels, was constructed as the first nautical tourism port forty years ago. It has a total of 100 berths for the reception of vessels of up to 8.50 m, as well as additional facilities within the hotel resort.

The Biograd Boat Show has also continuously been held at Marina Kornati for 26 years, as the leading Croatian nautical fair organised by Ilirija d.d.

Park Soline – a four-star campsite

Number of accommodation units: 1130

Capacity for 3,390 persons

Camping

The four-star "Park Soline" campsite is located in Biograd na Moru within the borders of the populated area, but as a separate physical planning-urban and economic entity in the south-east part of the town of Biograd na Moru, right by the main beach in the coastal length of approx. 1.5 km, with a 450-meter beach positioned right in front of the campsite.

The campsite covers an area of 20.00 ha and includes 1,130 accommodation units with a total capacity for up to 3,390 persons. It is situated in an outstanding natural environment of a predominantly high pine forest which provides shade to 90% of the campsite. By adhering to the principles of sustainability and environmental protection and considering the natural features of the area by using indigenous plant species, the horticultural landscaping of the campsite has been completed to the level of an arboretum, which is a remarkable and rare example in Croatia of creating added value for a tourism camping product.

In addition to fully equipped pitches (standard mare and comfort pitches), the camp also offers pitches with the basic infrastructure (standard and standard plus pitches), as well as mobile home zones Dalmatia, Premium, Comfort Plus, Dalmatia Plus, Comfort Family 32 m2 size, Glamping Family de Lux 42 m2 size and a zone with glamping tents.

Within the camp, guests have at their disposal modernly equipped sanitary facilities, laundry washers and driers, an exchange office, an internet café, a supermarket and restaurant facility.

The camp offers unlimited possibilities for an active holiday in its immediate vicinity: tennis courts, table tennis, indoor soccer, water skiing, snorkelling, sailing, bike rental, jogging, roller blading, beach volleyball, bowling, hiking and excursions to attractive national and nature parks (Krka National Park, Kornati National Park, Paklenica National Park, Telašćica Nature Park, Vransko Lake Nature Park) or historical towns (Zadar, Šibenik, Split).

Ilirija Travel

An innovative and comprehensive tourism product

Development of a year-round tourist offer

4 own facilities

The destination management company Ilirija Travel combines appealing products and services of the parent company into a unique tourism offer. The company built an innovative and comprehensive platform based on expertise and social responsibility, which is adatped to the demands of modern guests and the highest standards of the hospitality industry. While it includes a wide varitey of services of its partner companies, Ilirija Travel also conducts business in its own additional facilities, such as:

Arsenal a multifunctional space and one of only seven preserved buildings of its kind, which has been adapted according to the concept of an "indoor city square". The revitalisation of Arsenal created a perfect combination of business and culture tourism, which provided added value not only for Ilirija's tourist offer, but also for the destination as a whole. Arsenal is the centre of the region's public life, culture and entertainment, holding more than 100 public and private events each year.

The diffuse hotel Ražnjevića Dvori AD 1307 is located in the old town of Polača, in the historically agricultural region of Ravni Kotari in North Dalmatia, and represents a unit consisting of five functionally connected buildings, which makes it the first facility of this kind in the Republic of Croatia. This set-up is a great example of an innovative tourism product conceived as a combination of the traditional and the contemporary. In six independently decorated apartments, authentic Dalmatian stone houses have been converted into a tavern and a restaurant, and guests can also enjoy the outdoor swimming pool, stone terraces, and a wine bar. The space is also designed and equipped as a venue for meetings, seminars, team buildings, gala dinners and banquets, which can take place outdoors or in covered areas with a capacity for up to 200 people, as well as in indoor spaces for a minimum of six to about one hundred persons.

Villa Primorje, built in the second half of the 19th century, is a typical traditional Dalmatian stone manor house with an outbuilding. Newly renovated, luxuriously decorated and equipped according to the latest standards for facilities of this type and category, it has its own restaurant offering the opportunity to organize a number of events, a Mediterranean garden with a promenade and an outdoor swimming pool.

The "Nada" event boat, a 36-metre multifunctional yacht with a capacity for 180 persons, with a restaurant, kitchen and bar provides guests with excellent services pertaining to food and beverages during navigation. Business event organisers have access to a number of "tailor made" programmes adapted to their wishes, from the route, to the menus on offer, additional entertainment and conference room equipment, including beamers.

Real-estate segment - City Galleria

The City Galleria business and shopping centre is one of the two largest shopping centres in Zadar and the wider Zadar region. It was completed and opened to the public in October 2008, with a total gross surface area of more than 28,500 m2 spread over a total of six floors (two garage and four retail and business floors). The gross surface area of the centre consists of the associated underground garage with a total surface area of 10,863.50 m2, 9,445.32 m2 of net rentable area, as well as communications, technical and common rooms.

The Centre's offer of stores and services consists of a large number of various facilities, including an outdoor market with delicacy shops, specialised food and beverage stores, a supermarket, clothing, footwear and sportswear boutiques, sports facilities, various service and repair activities, beauty and hair salons, coffee shops, offices and the city's first and only multiplex cinema with 6 screens. The offer is conceptually divided by levels, where the underground garage with 410 marked parking spaces occupies floors -2 and -1, and is open to all users 24 hours a day with always available on-call staff and a security service. The ground floor and first floor of the centre contain a mixed offer with numerous food, service and retail shops; the second floor of the centre offers entertainment and sports facilities; while the third floor of the building houses office units.

Due to the good location of the building in a residential area near the old town and the fact that it is surrounded by some of the main city roads, the Centre is exceptionally easy to spot and access by a large number of local residents and foreign visitors.

Thanks to its unique architectural concept and location, the City Galleria centre has established itself as a place of citizens' day-to-day activities, as its varied offer can easily meet most of the visitors' everyday needs.

Hospitality

Capacity for 420 persons The Captain's Club

Capacity for 280 persons A Dalmatian tavern, a wine cellar

The restaurant "Marina Kornati" is located in the eponymous marina, just a few walking minutes away from the centre of Biograd. With a capacity for over 350 persons, which along with the recently renovated Captain's Club having a capacity for 70 people can receive up to 420 persons, it meets the needs of boaters when it comes to hosting various and numerous events in the Marina Kornati.

The restaurant "Park Soline" is located within the "Park Soline" camp, right next to the beach, with a terrace offering a view of the Pašman Canal. This restaurant, with a capacity for 280 persons, offers the possibility of organizing various events - soirées, banquets, family festivities as well as business meetings. Within the restaurant, there is also a Dalmatian tavern with a fireplace, a coffee shop and a wine bar arranged as a wine cellar, which provides you with the opportunity to buy and taste the highest quality red and white wine made from indigenous Croatian grape varieties.

The first lounge bar on the Biograd Riviera Lavender-inspired Mediterranean design

Capacity for 140 persons A building entered in the Register of Cultural Property

The Lavender lounge bar, located within the Adriatic Hotel right by the beach, is known for its lavender-inspired Mediterranean design and fully adapted for relaxation in the comfortable loungers in the shade of the pine trees. Many different events can be organised here - MICE events, weddings, banquets, and there is also a cocktail bed bar, a night club etc.

The Donat beach bar is located in the unique building within the protected cultural and historical unit of the town of Sv. Filip i Jakov, which is also entered in the Register of Cultural Goods of the Republic of Croatia. It is categorized as a beach bar/cocktail bar with a capacity of 140 persons.

The conference facilities of Ilirija d.d. are intended for clients who are looking for a complete event organisation service (logistical, technical, restaurant, etc.) in an authentic environment reflecting the history, culture and tradition of the place, destination and region. All Company sectors include these facilities, starting from conference facilities in the Ilirija Resort and the Captain's Club in the Marina Kornati. For clients wanting a special, unforgettable experience, we offer organisation of M.I.C.E. events on the "Nada" event boat, a floating conference centre, in the first Croatian scattered hotel Ražnjevića Dvori AD 1307, or in the historical ambience of Arsenal, a zero-category cultural monument located in the heart of the old Zadar city centre. Each hall is equipped with modern audio-visual equipment for organization of presentations, seminars and conferences, along with the constant support of our expert team and a full restaurant service. Ilirija Resort offers various service packages to event organisers, tailored to the needs of the businesspeople of today, with an individual approach to every event.

				THEATRE	LECTURE HALL	U-SHAPE	CONFERENCE	BANQUET	COCKTAIL
Facility	Room	Maximum capacity	Sur face area m2
HOTEL ILIRIJA	RESTAURANT	300	350				70	200	300
	ILIRIJA	100	215	100	8 0	3 0	3 0	50	100
KORNATI HOTEL	RESTAURANT	220	300			60	70	220	300
	KORNATI	3 0	45	3 0	20	20	20
ADRIATIC HOTEL	ADRIATIC 1	230	250	230	160	70	70	180	250
	ADRIATIC 2	60	8 0	60	4 0	3 0	3 0	4 0	50
	ADRIATIC 3	3 0	45	3 0	20	20	20
	ADRIATIC 4	20	3 0	20	12	1 0	1 0
	ADRIATIC 5	60	100	60	3 0	3 0	3 0	50	100
	LAVENDER	9 0	200	9 0	50	20	20	4 0	100
AG ROTOU R I S M ILIRIJA	CO N FE R E N C E ROOM	50	50	50	35	3 0	3 0	65	70
	TAVERN A	20	4 0	4 0	15		1 6	20	25
	TAVERN B	14	3 0				14	14	14
	TAVERN C	1 8	35	1 8	12	12	12	1 8	20
ARSENAL ZADAR		1000	1000	500	200	150	150	700	1000
E V E NT BOAT "NADA"	DECK 1	150	50	3 0	4 0			9 0	9 0
	DECK 2		60	60	35			4 6	60
M A R I N A KORNATI	CAPTAIN'S CLUB	100	120	100	60	60	60	8 0	100

Facility with a capacity for 4,000 persons, Sports, entertainment and catering facilities

One of the leading tennis centres in Dalmatia A surface area of 48,000 m2, 20 tennis courts, accompanying facilities

Among the 36 most significant nautical fairs in the world The largest international nautical fair in Croatia and South East Europe Croatian Nautical Industry and Tourism Congress

450 exhibitors and over 500 displayed vessels 6 Croatia Charter Expo – largest event of the charter industry

Sports-recreational and entertainment amenities:

Aquatic centre - built as a sports, entertainment and restaurant facility with an outdoor Olympic swimming pool, the centre is located on the main town beach, and it proudly displays the Blue Flag. The Centre also features a coffee shop and a fast food restaurant with a capacity for 350 people, and as such offers the possibility of organizing numerous public and private events. With its stands with 4,000 seats and its 1,000m2 terrace, it is the centre where almost all sports, entertainment and music events are held in the destination. The Aquatic Centre is also ideal for other events, such as weddings, team-buildings, banquets, MICE events and others.

The "Ilirija" tennis centre located in a pine forest has a surface area of 48,000 m2 and consists of 20 tennis courts and multi-purpose courts (14 ground and 6 colour-set courts) with night lighting. A restaurant, dressing rooms and auxiliary facilities are located within the centre.

Events:

Biograd Boat Show - is the largest international autumn nautical fair in the Republic of Croatia and the largest nautical fair in South East Europe.

In 2024, the fair (which marked its twenty-sixth anniversary) was attended by over 450 registered exhibitors, with 500 vessels at sea and on land and over 25 premier vessels, while over 150 registered charter companies, agencies and brokers actively participated in the charter fair (with over 500 accredited participants). A prestigious event dedicated to promoting luxury and adventure tourism – Croatia Luxury and Adventure Travel Show – was organised for the first time as well.

Thanks to the partnership with all relevant entities, the Biograd Boat Show has united "5 fairs in one", namely the Biograd Boat Show (an exhibition fair), Days of Croatian Nautics (a congress fair), Croatia Charter Expo (a leading charter fair), and Biograd B2B (a business fair) and Croatia Luxury and Adventure Travel Show as Luxury and Adventure Fair, thus profiling itself as a national congress of the Croatian nautical industry and tourism.

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Biograd Boat Show

Tourism sector

Hotel sector: 126,130

Camping sector: 321,016

Nautical sector (charter): 273,237

DMC Ilirija Travel: 40,424 participants

2.6 Market, Customers and Suppliers

Considering the diverse structure of the portfolio, the market and customers are divided into groups:

market and customers of the tourism sector

market and customers, or tenants of the real estate sector

Market and customers of the tourism sector

The tourism sector of the Company consists of: hotel, nautical and camping sectors and the destination management company Ilirija Travel, each of which has its own specific market and marketing and sales characteristics.

The Company's facilities recorded 720,383 overnight stays, including overnight stays realised by charter companies that, within the framework business cooperation, perform their activities in Marina Kornati. In the nautical sector, overnight stays do not constitute the basis of business since as of 2013 guests from EU Member States are not to be recorded pursuant to the Regulation on Conditions for the Arrival and Stay of Foreign Yachts and Boats Intended for Sports and Leisure Activities in the Internal Waters and Territorial Sea of the Republic of Croatia (OG 97/2013), with the exception of charter guests who are recorded by charter companies through crew lists.

indicators Hotel sector

Physical operating results

• 42,573 arrivals, an increase of 14% - 126,130 overnight stays, an increase of 6%

Market

• ADR EUR 134.44, an increase of 6% - TRevPAR EUR 22,522.63, an increase of 9% - RevPAR EUR 77.60, increase of 11%

Market segment (share of overnight stays)

• 46% individual sales

• 38% groups

• 14% allotment

Key markets

• Croatia 28%

• Slovenia 10%

• Austria 9%
• Germany 8%
• Slovakia 5%

Camping

Nautical sector

Market segment

• Contracted berth:
• a. Individual contractual berth
• b. Charter contractual berth
• Transit berth:
• a. Transit servicing market
• b. Sports/regatta market
• c. Holiday recreational market

Biograd Boat Show

• 5 shows in one event
• 450 exhibitors, 500 vessels and 25 vessel premiers
• B2B business segment with over 1,000 meetings
• 6 Croatia Charter Expo over 500 accredited participants and 150 charter companies - 1 Croatia Luxury and Adventure Travel Show

Physical operating results

• 754 contracted vessels
• 2,816 arrivals of transit vessels
• 7,179 overnight stays by transit vessels
• 273,237 overnight stays in the charter segment

DMC Ilirija travel

Physical indicators

• 295 events, an increase of 26%

• 40,424 people, an increase of 32%

• A complementary and

Product

• Year-round business

integrated tourist product

Facilities

• Arsenal,
• Ražnjevića dvori,
• Event ship "Nada",
• Villa Primorje

Real Estate – City Galleria

Realisation of revenue through

• Lease of business premises
• Common costs
• Use of common areas
• Garage parking spaces
• Other operating revenue

Key physical indicators

• 36 Lease Agreements
• 9,445.32m2 rented area
• 99.76% rate of occupancy

Customers (lessees)

• Local
• National
• International

Procurement organization is divided into procurement of:

investments and investment maintenance

Suppliers and Procurement Practices

The procurement practice represents a material topic for the Company given its direct effects on business performance quality in terms of providing services in accordance with local and international standards of the tourism industry, and considering the economic effects it has on the local, regional and national economy, given the fact that most suppliers are from the Republic of Croatia. All suppliers are expected to meet high parameters of quality and act in accordance with the corporate strategy and ethical business practices, while for food and beverage suppliers it is extremely important that they have a HACCP certificate.

The Company's suppliers are also its business partners, with which it shares values and principles of doing business. The Company strives for strategic, long-term and high-quality mutual relations with suppliers, with whom through many years of cooperation we work on creating additional value for both companies by (1) knowledge sharing, (2) improving the business process of both parties and (3) creating a quality product or service for both companies. Out of the total of 928 suppliers with whom we cooperated in 2024, we have cooperated for more than 30 years with 20 of them.

With some of them, we have cooperated for our very foundation, that is, for more than 67 years.

Procurement characteristics in 2024

5.26%

Transactions with international suppliers

Within the supply chain, we cooperate with producers, primary producers, distributors, wholesalers, contracted partners, brokers, consultants, small crafts and family-owned farms. In 2024, there were no lawsuits against the Company brought by its suppliers.

In the business year, the Company carried out transactions with a total of 928 suppliers. Out of those suppliers, 41 have their registered office abroad, which equals 4.42% of the total number of suppliers, while 95.58% of the suppliers have their registered office in the Republic of Croatia. Foreign suppliers accounted for 5.26% of the total transactions, while domestic suppliers accounted for 94.74% of the total transactions. The graph below shows that in 2024 the trend of a low share of foreign supplier turnover in the total realized turnover continued.

Overview of the % share in turnover of suppliers by registered office

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The transactions pertaining to the procurement of food and beverages, consumables, office supplies and technical material accounted for 26.04% of the total transactions in 2024. Cooperation with foreign suppliers in the aforementioned procurement category accounted for only 0.63% of the transactions, local suppliers accounted for 53.99% of the transactions, and the remaining 45.38% of the transactions pertained to suppliers from other parts of Croatia.

Overview of the % share in the turnover of suppliers of food and beverages, technical and office supplies by registered office:

FOREIGN BIOGRAD WITH THE SURROUNDING AREA ZADAR WITH THE SURROUNDING AREA THE REST OF CROATIA

2.7 Standards and Certificates

High quality and standards of services, their continuous improvement and enhancement, care for the safety and health of guests and employees, meeting customer needs and expectations, competitiveness and sustainability of products, continuous improvement of operational processes and continuous employee education, environmental protection and preservation of biodiversity are the main directions of the Company and they are achieved through the implementation of domestic and international standards into its operations.

The Company implemented an integrated environmental and quality management system under the ISO 9001:2015 (quality management) and ISO 14001:2015 (environmental management) standards, by which Ilirija focuses on the continued improvement of processes connected to the service quality and standards enhancement, the enhancement of operational and management processes, at the same time connected to the environmental management system. By implementing the integrated Environmental and Quality Policy, Ilirija confirms its main focus on long-term business stability based on responsible and sustainable business operations. During 2024, a regular control audit was performed as part of the quality management system ISO 9001:2015 and the environmental management system ISO 14001:2015.

Ilirija d.d. has a certified HACCP system in place, ensuring a high level of control throughout the production and distribution processes of food products. This system enables the identification and assessment of all potential hazards, as well as their prevention and control, and ensures the implementation of measures that support effective operations. In 2024, the international certification company SGS Adriatica d.o.o. conducted its regular audit of the HACCP Codex Alimentarius system, which confirmed that the Company, at the level of all its sectors in the area of food and beverage services, carries out a high degree of control during the process of production and distribution of food products.

Ilirija d.d. uses "green" electricity and holds a ZelEn certificate guaranteeing that the electricity we use comes from renewable sources.

"Park Soline" campsite is the holder of the international Green Key certificate, attesting to the fulfilment of all criteria for the award of this eco-label in the field of sustainable development and environmental protection.

Following a successful audit in September 2015, the "Park Soline" campsite was awarded the international "Ecocamping" certificate With our membership in the Ecocamping Network, consisting of more than 240 camps from seven European countries, Ilirija continues to commit itself to promoting ecology, sustainable development and socially responsible business even further, with particular emphasis on efficient energy management (water, electricity), waste sorting and recycling, preservation of nature and biodiversity, etc.

"Park Soline" camp has joined the "CAMPING in PARKS" project, which unites national and nature parks with campsites in their immediate vicinity.

The "Health-Friendly Company" certificate was awarded to Ilirija in 2018 by the Croatian Institute of Public Health. This recognition promotes health in the workplace and work environment, supports employees in adopting healthy lifestyle habits, and demonstrates the company's commitment to employee well-being.

2.8 Awards and Acknowledgements

ILIRIJA d.d. received the 2024 Annual Award of the Town of Biograd na Moru for its outstanding contribution to the development of tourism in the town of Biograd na Moru as the destination's largest tourism company which, through its work and dedication, made Biograd na Moru a recognisable tourist destination, as well as for its dedication to service quality, innovation, preservation of local culture and tradition and, in general, the entirety of its contributions in the field of economy, tourism and the development of the town of Biograd na Moru, in which the company has operated without interruption for 67 years.

2.9 Significant Events

At the session held on 26 February 2024, the Company Management Board adopted the Q4 2023 financial statements (unaudited, unconsolidated), the Annual Report and the 2023 Annual Financial Statements (audited, unconsolidated). Also, at the session of the Supervisory Board held on the same day, the Company's Annual Report, 2023 annual financial statements (audited, unconsolidated) were adopted and draft decisions were established, which were sent to the General Assembly for adoption.

The General Assembly, held on 26 April 2024, took note of the Annual Report for 2023 together with the Audit Report for 2023, Report of the Supervisory Board on the Performed Supervision of the Company's Operations for 2023, and the Management Board' Report on the Acquisition of Own Shares in 2023. The General Assembly adopted the Decision on the Approval of the 2023 Report on the Remuneration of Management Board and Supervisory Board Members, the Decision on Granting Discharge to the Management Board for the financial year 2023, Decision on Granting Discharge to the Members of the Supervisory Board for the financial year 2023, Decision on Granting Authority to the Management Board for the Acquisition of Own Shares, Decision on Confirmation of the Previously Approved Policy on the Income of the Management Board Members and the Decision on the Appointment of the authorised auditing company "UHY RUDAN d.o.o.", Ilica 213, Zagreb, PIN: 717995390000 for 2024.

Also, the Decision on the Use of Profit for the 2023 Financial Year was adopted at the General Assembly, according to which the achieved net profit in the 2023 financial year (after tax) in the amount of EUR 3,279,530.22, is distributed as follows:

• EUR 1,593,618.72 into the retained profit, and
• EUR 1,685,911.50 for dividend distribution.

The dividend per share amounts to EUR 0.70.

At the meeting held on 16 September 2024, in order to harmonise the term of office of its members, the Supervisory Board adopted a decision on the recall and re-election of all members of the Supervisory Board and established a proposal for a call with an agenda for convening an extraordinary General Assembly, which was convened for 25 October 2024.

On 25 October 2024, an extraordinary General Assembly was held, at which, in order to harmonise the Supervisory Board members' term of office, a resolution was adopted to recall and re-elect the existing members of the Supervisory Board. Elected members of the Supervisory Board of Ilirija d.d. are as follows: Mr Goran Medić, Mr David Anthony Tudorović, Mr Davor Tudorović, Mr Siniša Petrović and Mr Darko Prebežac. The term of office of the newly elected members of the Supervisory Board of the Company shall be 4 (four) years.

At the constituent meeting of the Supervisory Board held on 25 October 2024, Mr Goran Medić was elected as the Chairman of the Supervisory Board, and Mr David Anthony Tudorović was elected as the Deputy Chairman of the David Anthony Tudorović.

3 BUSINESS MODEL FOR THE SUSTAINABLE DEVELOPMENT OF ILIRIJA D.D.

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3.1 Business Model Description

Ilirija has been present on the domestic and international markets for more than six decades, and in 2016, following the acquisition of the City Galleria Business and Shopping Centre, the Company can offer a wide range of activities under a portfolio consisting of the following 5 sectors:

• Hotel sector 4 hotels, 435 rooms, 910 beds
• Nautical sector 805 berths, 2,000 persons
• Camping sector 1130 pitches, 3390 persons
• Destination management company/DMC Ilirija Travel through which 295 special events for 40,424 persons were organised in 2024
• Real estate sector City Galleria Business and Shopping Centre in Zadar, one of the two largest shopping centres in the wider Zadar region

Diverse tourism and real-estate portfolios are based on the resources of the region and on a continuous investment in the improvement of the existing contents and products as well as the development of new ones, which is also the foundation of the Company's business and development policy. With more than six decades of market presence and the resulting knowledge and experience the Company is able to preserve the environment and contribute to the development of the local community while maximising its economic, financial, market and human resources potential. Furthermore, by developing a complementary and integrated product through the destination management company, the Company strives for achieving one of its strategic goals – year-round business operations of its tourism sectors, with an emphasis on the hotel sector and camping, through high-standard extension of the high season to pre-season and post-season and creating added value for both the Company and the destination, or the wider community.

3.2 Business Model and Sustainability

Having tourism activities as the Company's primary activities has significant economic impacts on the society, both at the local and the national level. At the same time, tourism as a very complex industry, which includes numerous stakeholders and requires a significant number of resources, can have opposite effects depending on the way tourist services are managed. If tourist services and facilities are managed responsibly, emphasising the preservation of authenticity, the growth of service innovation, quality and standards, the creation of an offer with added value, i.e. sustainable, responsible and year-round tourism, then tourism plays a positive role in the social, cultural, economic and environmental development of the destination and represents a significant opportunity for community development.

For this reason, comprehensive planning and management of sustainable tourism activities and facilities is imperative to the Company, in order to ensure sustainable long-term business operations while respecting the needs of the local community and all its stakeholders. Stakeholders are the key factor for the Company's successful and long-term development, so the Company defines its business strategy through dialogue with stakeholders so as to understand their expectations. Stakeholder dialogue defined the material topics that the stakeholders perceive as topics through which the Company can influence the community, environment and economy the most.

The Company operates in accordance with principles and practices of good corporate governance, providing a high level of transparency and accountability in relation to all of its stakeholders. Therefore, the Company's corporate strategy is based on the fundamental principles of corporate social responsibility and sustainable business practices, which constitute an integral part of the Company's corporate values, and are embedded in the long-term business practice and processes towards its stakeholders. Setting up the Company's business model this way creates new opportunities for business development and sustainability through continuous development of new products and improvement of services.

The Company's business model makes it a driver of tourism and economic development in its local community and region, while establishing an optimum level of quality and competitiveness in its offer and continuously preserving nature and environmental resources in the geographical area of its operations.

3.3 Sustainable Business Strategy

Ilirija d.d.'s sustainable business strategy is an integral part of its corporate strategy and its aim is to create added value for all stakeholders in its business process by balancing their rights, liabilities and interests. Setting up the sustainable business strategy this way creates new opportunities for business development and sustainability through the continuous development of new products and services, economic and social contributions to the development of the destination, the creation of philanthropic programmes for the wider community, the development of year-round tourist activity, the application of responsible managerial practices, additional activities in environmental and biodiversity protection, maintaining the current high share of the local population in the structure of employees as well as a high share of national suppliers and local family farms. Apart from economic achievements as a fundamental prerequisite for sustainable and responsible business, the Sustainable Business Strategy also takes into consideration the ESG goals and European Union initiatives.

The long-term main goals of Ilirija in terms of sustainable business were also set in 2024:

The sustainable business strategy consists of four main areas:

• (I) Corporate responsibility and sustainability
• (II) Environment
• (III) Society
• (IV) Business conduct

(I) Corporate responsibility and sustainability

In terms of corporate responsibility and sustainability, focus is placed on the future growth of the Company, its business stability and excellence that exert a marked social and economic impact on the local, regional and national economy through the Company's activities.

The responsible and sustainable business strategy is based on the following determinants:

• dedication to long-term corporate sustainability and responsibility at all levels of business processes and business activities
• creating added value for the Company's shareholder groups
• continued implementation and affirmation of the key principles of corporate sustainability and responsibility within the Company and in the broader community
• retaining and maintaining the status of the leading tourism company in the destinations where it operates
• economic and social driver of regional and Croatian economy
• year-round business development in the Company's tourism sectors and creating added value for destinations in which it operates
• integrating economic and social aspects and care for the environment into the decisionmaking process
• sustainable and continuous investments in the development of sustainable, high-quality, recognisable and competitive products and services

Corporate responsibility and sustainability is described in the following documents:

• Annual business reports
• Quarterly financial statements
• Corporate disclosures

*The documents are publicly available on the website of ILIRIJA d.d. (www.ilirijabiograd.com), HANFA (www.hanfa.hr), and the Zagreb Stock Exchange (www.zse.hr), and have been submitted to HINA.

(II) Environment

When it comes to environmental management, the Company is committed, in the long term, to protecting and preserving the environment (water, air, soil, waste waters) as the basic resource of the tourism industry. Therefore, its activities are not only focused on environmental protection, but also on maximising its impacts through rational natural resource management and the prevention of pollution. Environmental protection is managed by integrated management systems of the Company that are a part of its strategic decisions and business processes. The Company strives to quantify every environmental impact as much as possible.

Integrated Quality and Environmental Protection Policy:

• continuously meeting the needs and expectations of the customers/guests
• continuous care for guest and employee safety
• continuous commitment to environmental protection, including pollution prevention and sustainable use of natural resources
• continuous compliance with relevant legislation and other binding requirements
• continuous improvement of processes and services, as well as the overall quality and environmental management system
• continuous improvement of the knowledge and motivation of employees
• continuous value creation preservation of Ilirija d.d.

The approach to environmental protection is defined and described in the following documents:

• Quality And Environmental Policy
• Internal sector-specific quality and environmental protection manuals
• Internal work instructions for the disposal of all types of waste
• Domestic and international ecological standards

(III) Society

Ilirija's strategy in terms of its relationship towards the wider community is carried out through the development of the local and regional economy, employing the local population, corporate philanthropy system, activities in the area of the development of the destination offer and amenities, participation in the activity of expert and professional associations, and supporting other organisations, associations, the local and the regional self-government.

The social responsibility strategy is based on the following determinants:

• transparent and open communication with stakeholders
• active role in the business community (membership in business and expert associations)
• employing the local population
• hiring local suppliers
• encouraging the development of the tourism offer of the destinations in which we operate
• care for employees by ensuring the right to personal and professional development and concern for material rights
• implementation of the business diversity and non-discrimination principle
• corporate philanthropy supporting the activities and projects of wider interest to the community

Cooperation with the social community is described in the following documents

• Sustainability reports

*Javno dostupni na stranicama ILIRIJE d.d. (www.ilirijabiograd.com), HANFA-e (www.hanfa.hr) i Zagrebačke burze (www.zse.hr) i dostavljeni HINA-i. *The documents are publicly available on the website of ILIRIJA d.d. (www.ilirijabiograd.com), HANFA (www.hanfa.hr), and the Zagreb Stock Exchange (www.zse.hr), and have been submitted to HINA.

(IV) Business conduct

Ilirija operates in accordance with principles and practices of good corporate governance, providing a high level of transparency and accountability in relation to its stakeholders. The Company has a dualistic management structure with clearly separated powers and responsibilities, it applies the Corporate Governance Code and Code of Business Ethics, clearly set and communicated business objectives and adheres to the diversity and equal opportunity principles, strives towards hiring domestic and local suppliers, conducts activities in the domain of occupational and guest and employee health and safety.

The responsible and ethical management strategy is based on the following determinants:

• responsible and ethical management at all levels
• compliance with legal requirements
• respect for human rights, diversity and equality
• transparency in business and stakeholder relationships
• striving for excellence in our services and operational processes through implementing domestic and international management, service quality and safety standards
• internal acts with a clearly defined job description, responsibilities and rules of conduct of the management structure (Management Board and Supervisory Board)
• application of the Corporate Governance Code and the Code of Business Ethics of the Croatian Chamber of Commerce
• care for guest and employee health and safety
• responsible conduct in terms of environmental protection

Responsible and ethical management is described and defined in the following documents:

• Articles of Association of the Joint Stock Company Ilirija d.d.
• Rules of Procedure of the Supervisory Board
• Rules of Procedure of the Audit Committee
• Rules of Procedure of the Management Board
• Remuneration Policy for Management Board Members
• Remuneration Policy for Supervisory Board Members
• Corporate Governance Code Compliance Questionnaire
• Work Regulations
• Occupational Health and Safety Regulations
• Quality And Environmental Policy
• Fire Protection Regulations
• Fire Protection and Evacuation Plan

They refer to the organisational and management structure, business conduct policies and suppliers.

Corporate Governance – in accordance with principles and practices of good corporate governance, providing a high level of transparency and accountability in relation to all Company stakeholders.

	(I) Corporate responsibility and sustainability	(II) Environmental protection	(III) Society	(IV) Business conduct
Areas included in the goals:	These refer to the long-term viability and su stainability of the Company, financial stabi lity, competitiveness, preservation of long term business activity, assets and capital.	They refer to environmental protection and are oriented towards climate change, reducing pollu tion and preserving biodiversity and resources.	They refer to our employees, complying with the principle of equality and diversity in the workplace, employee education and their material position.	They refer to the organisational and management structure, business conduct policies and suppliers.
oals: G	The growth of key performance indicators (finan cial and physical): overnight stays, the number of sold accommodation units, occupancy, ADR, revenue, net profit, EBITDA, value of assets and capital, market capitalization and the pre servation of a sustainable level of net debt.	Gradual reduction in greenhouse gas emissions in all business segments.	Minimum 70% of the local population in the total employee structure in the main season or 85% of the population from the local community (Za dar County) at the end of the reporting period.*	Corporate Governance – in accordance with princi ples and practices of good corporate governance, providing a high level of transparency and acco untability in relation to all Company stakeholders.
	Continuous development of new and improved existing products and services through sustaina ble investments in the green transition, renewa ble energy sources and digital transformation.	The reduction of the generated mixed waste at the source of its generation and an incre ase in the share of recyclable materials.	Equal pay for equal work.	Monitoring and compliance with the legal regulations.
	Continuation of the digitalisation of business activities, with an emphasis on sales and mar keting and managing customer relations.	Preservation of biodiversity in operative are as of the Company, including the reduction of harmful impacts on ecosystems and species.	Continued improvement of the material position of the employees through the realisation of the average salary on the level of the achieved ave rage salary in the Republic of Croatia and other material and non-material employee benefits.	90% turnover with Croatian suppliers.
	Strengthening Company competitiveness and retaining the position of top 20 leading tourist companies in the Republic of Croatia according to key performance indicators of the tourism industry.	Water use optimisation and reduction of wa ter pollution, including the introduction of effective waste water treatment systems.	Trainings and professional and personal growth of employees monitored through the increase of the number of engaged employees and hours of trainings and by defining the strategic priority areas: Hospitality – food offer and service Sales and marketing – digital marketing and sales, mana gement of customer relations Management – sustainable and responsible business Healthcare, occupational health and safety and fire protection.

90% turnover with Croatian suppliers.

ESG Goals

Based on the Sustainable Business Strategy, Ilirija d.d. defined its ESG goals in 2024 for the period from 2025 until 2030, encompassing the key goals in terms of sustainability by area:

*Compared to the 2023 Sustainability Report, the share of the domestic population has been revised in such a manner that due to the seasonal nature of the business, it is divided into the main season and the end of the reporting period.

3.4 Vision, Mission and Fundamental Values

Vision - to permanently secure a position among the 3 leading tourism companies in Northern Dalmatia and among the 20 leading tourism companies in the Republic of Croatia in key segments of the Croatian tourist offer (hotel, nautical, camping), to be and to remain the carrier of tourist and economic development of our region and of the destinations of Biograd na Moru, Zadar and Sv. Filip i Jakov, along with the development of year-round business through complementary and selective tourist offer forms.

Mission - to increase the assets and achieve financial results that will ensure long-term business and financial stability, to establish the optimum level of quality and competitiveness in business at the level of the overall Croatian tourist offer, along with the constant investment in human resources and ensuring the optimal level of employment, as well as ensuring and respecting the principle of sustainable development manifested in the recognition and meeting of the needs of tourists, protecting and restoring the natural and cultural heritage, and preserving the environment, or creating a responsible and sustainable tourist offer.

Fundamental values:

Respect and integrity – equality of treatment and attitude towards all our stakeholders constitute the basic values of our Company.

Quality – top product - the quality of the services provided is continuously improved, and a top quality product, professional service, the introduction and implementation of standards aimed at achieving excellence in our services, as well as an individual approach to clients constitute the basis of our relationship towards our guests, who are at the heart of the Company's service.

Innovation – to be the initiator and creator of innovative tourism products and services which contribute to the future development of the Company, the destination and Croatian tourism.

Sustainability and responsibility – in business, investment, relationships with our employees, business partners, clients (guests), the local and regional community, with shareholders and in day-to-day business, through the integration of economic, social and environmental aspects into the company's decision-making processes and corporate strategy. Balancing the said aspects is the basis of the Company's success and sustainable development.

Transparency – in business and communication with all stakeholders of the Company, while adhering to the principles of timely and true information as a prerequisite for strengthening its market position and promoting its further growth.

3.5 Contribution to Achieving the UN Sustainable Development Goals

By adopting the Global Sustainable Development Goals (SDGs) for the period up to 2030, the United Nations' goal was to set the foundations of sustainable development on a global scale through 17 defined goals in four areas: fight against climate change, fight against injustice, inequality and poverty.

Ilirija supports all 17 global sustainable development goals, while its activities mostly contribute to the following United Nations Global Sustainable Development Goals (SDGs) of the year:

Ilirija is a user of "ZelEn" energy (energy from renewable sources), and at the same time, it uses environmentally cleaner energy sources (natural and liquefied gas) in most of its facilities.

Starting from the premise that economic development and growth are fundamental for sustainable and responsible business operations, Ilirija continued its business growth in 2024, achieving the best performance to date across all individual sectors as well as at the company level as a whole. Furthermore, the company maintained its commitment to the material well-being of employees, ensuring not only an optimal personnel structure but also providing benefits above the industry average. This included new hiring, ongoing training, and the creation of a stimulating and motivating work environment, along with a focus on employee health and investments aimed at improving service standards and quality. The business year was also marked by the strengthening of year-round operations, with increased activity during the pre- and post-season periods, primarily driven by the Ilirija Travel destination management company, with the goal of developing sustainable destinations.

One of the fundamental goals of the Company promote and adhere to the principle of sustainable development, which is reflected in recognizing and meeting the needs of tourists, preserving the authenticity, protecting and restoring natural and cultural heritage, conserving the environment and biodiversity, and cooperating with local suppliers, i.e. creating a responsible and sustainable tourism offer.

Ilirija is a signatory of the Croatian Diversity Charter, the President of the Management Board is a diversity ambassador and a member of the Gender Equality Federation. In its operations, the Company has been continuously fostering the principles of equal opportunities in the workplace for all employees, zero tolerance for any form of discrimination, equal pay for equal work and actively promoting values on which its diversity is based.

The foundations of the Company's operations are the principles of sustainable and responsible development with a strong emphasis on environmental protection (soil, water, air, waste...). The Protection of the Environment and Horticulture department was established as part of the Safety Service, and the Company has defined its environmental protection system, it has developed an integrated environmental quality and protection policy, implemented domestic and international standards and certificates (ISO 14001:2015, ISO 9001:2015, Blue Flag, Green Key), its horticultural design and landscaping is consistent with the Mediterranean area, it uses renewable and environmentally cleaner energy sources, organises trainings for stakeholders on environmental protection and uses certified eco-friendly materials and products.

Ilirija is an active member of 14 professional, expert and business associations, some of which are associations that promote corporate social responsibility (Croatian Business Council for Sustainable Development, Gender Equality Federation, the company is a signatory of the Croatian Diversity Charter, the President of the Management Board is one of the diversity ambassadors).

3.6 Corporate Governance and Organisational Structure

Organizational structure

Corporate governance is based on seven pillars:

Naknada i nagrađivanje Remuneration and award

Corporate Governance

As a public limited company, Ilirija has a dualistic management structure in accordance with the corporate governance practices and legal regulations of the Republic of Croatia, with separate powers and responsibilities of the governing bodies of the Company, i.e. the General Assembly, the Supervisory Board and the Management Board.

It operates in accordance with principles and practices of good corporate governance, providing a high level of transparency and accountability in relation to all of its stakeholders. Ilirija applies the Corporate Governance Code jointly adopted by Zagreb Stock Exchange and HANFA, which is available on their websites. Each year, the Company completes and publishes the annual questionnaire prescribed by the Code, in which, when applicable and in line with the "act or explain" mechanism, it specifies the reasons for possible deviations from the Code. Pursuant to the regulations, the annual questionnaire is published on the website of Zagreb Stock Exchange (www.zse.hr) and the Company (www.ilirijabiograd.com). It also applies the Code of Business Ethics of the Croatian Chamber of Commerce, doing business in accordance with the principles of responsibility, ethics, transparency and respect of good business practices towards all stakeholders in its business process.

The Company has a worked-out a system of internal controls at all levels, the aim of which is to ensure operational functioning and security of business processes, satisfaction with the service quality and standards as well as implementation and application of legal regulations, all of which contributes to timely publication within legally prescribed time limits of financial reports that provide objective data on the Company's financial position and business results. The main characteristics of risk exposure and management are covered by the chapter "Risks, Risk Management and Opportunities".

Management structure

General Assembly

The General Assembly consists of all shareholders (owners) of the Company's securities. As at 31 December 2024, the Company had a total of 249 shareholders, who held a total of 2,413,488 shares. The shareholders exercise their rights at the General Assembly.

All shareholders of the Company entered in the book of shares, who report their intention to participate in the General Assembly to the Company in person or by proxy shall have the right to participate. Whenever they intend to do so by proxy, they shall submit a written power of attorney no later than six days prior to the holding of the General Assembly. In accordance with the provisions of the Company's Articles of Association and the Companies Act, the General Assembly adopts decisions on the following matters: appointment and dismissal of the Supervisory Board and the Management Board, increase or decrease in the share capital, decisions on the allocation of profit, decisions on dividend distribution, decisions completely or partially excluding the priority right of shareholders for the subscription of new shares, withdrawal or listing of shares from a regulated market, amendments to the Articles of Association, appointment of auditors, decisions on activity change and other matters defined by the law. Significant decisions adopted by the General Assembly in 2024 are indicated in the chapter "Significant Events".

Pursuant to the Articles of Association, the shareholders' voting rights are not limited to a specific percentage or number of votes. Every share grants one voting right at the General Assembly. In the Company, there are no securities with special control rights, nor are there any limitations on voting rights. In 2024, the Regular General Assembly of Ilirija d.d. was held on 26/02/2024, and the Extraordinary General Assembly was held on 25/10/2024. As legally required, the decisions of the general Assemblies were published and are available on the website of the company (www.ilirijabiograd.com), the Zagreb Stock Exchange (www.zse.hr), HANFA and the officially appointed mechanism for the central storage of regulated information – SRPI (www.hanfa.hr), as well as the Croatian News Agency (www.hina.hr), and they were submitted to the Register of the Commercial Court, namely in accordance with legal regulations.

Supervisory Board

The Supervisory Board has five members, who are appointed for a term of four years. The Supervisory Board is responsible for supervising the management of the Company's business activities and appointment of the Management Board members; in addition, it decides on all other matters falling within its scope of competence pursuant to the legal regulations and its Articles of Association. The Supervisory Board meets at least four times a year. Supervisory Board member Mr Darko Prebežac is an independent member, while the Deputy Chairman of the Supervisory Board, Mr David Anthony Tudorović, among other qualifications, has professional knowledge in the field of accounting and auditing of financial reports.

The Supervisory Board has appointed the Audit Committee, which supervises the existence and functioning of internal controls, risk management and financial reporting, as well as independence of external auditors.

The main criteria for appointment to the Supervisory Board include professional qualifications, knowledge, managerial experience, and personal integrity.

Supervisory board	Function	Term of office	Committee
Goran Medić	Chairman	October 2024 - October 2028	Audit Committee
David Anthony Tudorović	Deputy Chairman	October 2024 - October 2028	Audit Committee
Davor Tudorović	Member	October 2024 - October 2028
Siniša Petrović	Member	October 2024 - October 2028
Darko Prebežac	Member	October 2024 - October 2028	Audit Committee

Management Board

The Company Management Board is composed of one member appointed by the Supervisory Board for a five-year term. With the Decision of the Supervisory Board of 15 June 2020, Mr Goran Ražnjević was reappointed as the sole member of the Company's Management Board for a five-year term, starting from 18 June 2020. The Management Board represents the Company independently and individually and manages the Company's business activities in accordance with the Articles of Association, Work Regulations of the Management Board, and legal regulations.

Sustainability Management

The Company's business operations are anchored in the principles of sustainable and responsible development, which presuppose that economic development does not endanger the existing natural resources, the cultural, historic and natural heritage and it considers how it affects the economy, community and environment in its decision-making as a business entity.

The Company's Management Board is in charge and responsible for the development and management of the business in the area of sustainability, including managers from different areas of business, i.e. marketing and sales, operational business and business processes, communications and corporate affairs, legal department, human resources, environmental protection and horticulture, health control, occupational health and safety and fire protection. Likewise, the expert team for the preparation of sustainability reports is in charge of monitoring regulations in sustainable development and of the implementation of sustainable development objectives and activities in the Company's operational business and their monitoring.

Ownership structure

The Company's share capital amounts to EUR 30,420,000.00 and is divided into 2,413,488 no-par-value ordinary shares. As at 31 December 2024, there were no significant changes in the ownership structure, while an overview of the major shareholders of the Company as at 31 December 2024 is provided below

Owners - shareholders	Number of shares	Share in %
Arsenal Holdings d.o.o. Zadar	1,429,032	59.21
OTP banka d.d./AZ OMF of B category	328,506	13.61
Goran Ražnjević	201,120	8.33
Davor Tudorović	95,744	3.97
OTP banka d.d./AZ mandatory pension fund of A category	69,898	2.90
Zagrebačka banka d.d./AZ Profit voluntary pension fund	68,200	2.83
Goran Medić	40,000	1.66
Zoran Bogdanović	26,216	1.09
CERP/Republic of Croatia	25,342	1.05
Ilirija d.d. (treasury shares)	15,493	0.64
OTP banka d.d./Erste plavi expert - voluntary pension fund	9,726	0.40
OTP banka d.d./Erste plavi OMF of A category	8,631	0.36
Other shareholders	95,580	3.95
TOTAL	2,413,488	100.00

Types of risks

Economic and financial risks

3.7 Risk, Risk Management and Opportunities

The Company assesses the risks at the macro and micro level for each of the business sectors, assessing them according to the criterion of likelihood of risk occurrence and consequences or impact of each individual risk on its business processes and system.

The Company's risk management process involves the following essential steps

Global risks and the macroeconomic environment

4 Monitoring and reassessment of risks

1 Economic and financial risks

On 12 July 2022, the Council of the European Union adopted the Decision on the adoption of the euro in Croatia on 1 January 2023, establishing that the Republic of Croatia fulfils all the requirements for the introduction of the euro as the official currency in the Republic of Croatia, as well as Council Regulation (EU) of 12 July 2022 regarding the euro conversion rate for Croatia, establishing that the conversion rate shall amount to HRK 7.53450 for one euro. In accordance with the aforementioned Decision and Regulation, the Government of the Republic of Croatia adopted the Decision on the announcement of the introduction of the euro as the official currency in the Republic of Croatia, setting out that the euro shall become the official monetary unit and legal tender in the Republic of Croatia on 1 January 2023. The introduction of the euro as the official currency in the Republic of Croatia significantly affects the Company's exposure to currency and price risks. More precisely, with the adoption of the aforementioned decisions/ regulations at the level of the European Union and the Republic of Croatia, the Company is no longer exposed to currency and price risks.

In terms of credit risk, i.e. the obligation to repay loans used by the Company, taken out with a currency clause, which were dependent on the movement of the Croatian kuna exchange rate against the euro, the introduction of the euro as the official currency eliminates the said risk. Also, the negative aspects of exchange rate differences for loans taken out in euros will no longer pose a risk. Indebtedness of the Company with the commercial bank is for the most part subject to fixed interest rates. Taking this into consideration, the Company is not exposed to interest rate risk on that basis. For the purpose of reducing credit risk, the Company strives to reduce its overall credit liabilities to an adequate, i.e. a higher level in order for them to be lower than its own sources of funds. In its operations, as one of the foundations of its business and financial security, the Company strives to have as little net debt as possible, thus significantly reducing the existing credit risk. Financial assets that may potentially expose the Company to credit risk are cash and trade receivables. Trade receivables pertaining to certain customers may entail credit risk, depending on the level of turnover realised with certain customers and the general state of liquidity in the country. Trade receivables are reported with reference to real values. The Company actively monitors and manages trade receivables, at the same time taking especially into account the difficult macroeconomic situation, and applying measures of collection in instalments; and, if necessary, eventually undertaking measures of enforced collection, including by activating security instruments for the purpose of collection of its claims. An adjustment of the value of trade receivables is indicated when there is objective evidence that the Company will not be able to collect all of its claims in accordance with the agreed terms. Apart from the aforementioned, the Company has no exposure to any other significant credit risk.

Liquidity management implies maintaining a sufficient amount of money in order to settle the Company's liabilities. One of the primary Company goals in the challenging business environment caused by unfavourable macroeconomic environment is to maintain its current liquidity. The Company is, therefore, undertaking activities to diversify its existing and secure new financing sources (if necessary), it is trying to minimize and optimize all of its operating costs, and is willing to and capable of actively cooperating with all significant creditors by settling the liabilities they had at the time when challenging business conditions materialised.

The continuous growth of strong inflationary pressures primarily caused by increases in the prices of primary energy products (oil, gas, electricity), which subsequently spread to consumer goods and services (especially food and beverages), along with the current geopolitical instability essentially generated strong inflation impacts not only on business entities of European Union countries, but also on their society in general. If they remain strong, inflationary pressures could affect purchasing power and new demand generation, and slow down economic activities in the euro area. In the Republic of Croatia, the prices of goods and services for personal consumption, measured by the consumer price index, in 2024 were on average 3% higher than in 2023. As for the energy costs, primarily electricity as the primary energy source, the Company managed to protect itself from significant increases in electricity prices in time, namely with a multi-year contract, which mitigated the impact of the increase in electricity prices on total operating costs. The very intense increase in food and beverage costs constitutes a strong generator of inflation growth and at the same time accounts for a significant share of the operating expenses and significantly affects the prices of services in the hospitality and tourism industry. Therefore, by actively monitoring food and beverage prices and cooperating with key suppliers, the Company strives to minimise such prices as much as possible, i.e. ensure stability and security of the supply along with the highest possible procurement cost control. On the other hand, through dynamic daily management of accommodation unit prices, it aims to achieve the maximum level of competitiveness possible, as well as intense and systematic demand monitoring, and a quick and strong response to market trends, while at the same time striving for a timely response to potentially negative challenges and impacts such as inflation.

Bookkeeping values of the following items of financial assets and financial liabilities reflect their respective fair values: money, investments, trade payables, other receivables and other liabilities, loans granted to employees, long-term liabilities.

Maritime domain

Unresolved issue of tourism land

2 Regulatory risks

As one of the most significant risks in business operations of tourism companies, Ilirija d.d. included, the Company points out unresolved property rights issues concerning tourism land and legal investments in the maritime domain and the related issues of protection of acquired rights based on legitimate investments and of legitimate expectations of companies performing their activities on the maritime domain or tourism land.

The Company is exposed to changes in tax and other regulations within the legal system of the Republic of Croatia. In particular, this applies to the regulations pertaining to the maritime domain and tourism land, in which domain the company has made significant investments crucial for its business, while not all rights guaranteed by the Constitution in the field of acquired rights before, during and after conversion, the protection of legal capital investments, and the legitimate expectations regarding legal investments have been fully realised under Articles 48 and 49 of the Constitution of the Republic of Croatia.

Tourism land – unresolved issue

Pursuant to the Act on Tourism and Other Construction Land Not Evaluated in the Conversion and Privatisation Process (hereinafter: the Act), adopted in July 2010, the Company submitted to the Republic of Croatia, within the legally prescribed deadline, i.e. in January 2011, an application for a concession on tourism land for the "Park Soline" campsite in Biograd na Moru for a period of 50 years. Due to unclear provisions of the Act, no decision has been rendered during its validity regarding the Company's application. In the meantime, in May 2020 a new act on non-evaluated construction land was adopted, and thus the Act on Tourism and Other Construction Land Not Evaluated in the Conversion and Privatisation process ceased to have effect. The new Act provides for the right of tourism companies to submit an application for leasing construction tourism land for a period of 50 years. In March 2021 the Company submitted the appropriate application for leasing construction land in the campsite for a period of 50 years to the competent authority of the Republic of Croatia, that is, to the Ministry of Physical Planning, Construction and State Assets. Under the provisions of the Act on Non-Evaluated Construction land, a company shall become the owner of buildings, land under buildings and land in the campsite that were evaluated and entered into the value of social capital in the conversion and privatisation process, while the Republic of Croatia shall become the owner of buildings and land in the campsite that were not evaluated and entered into the value of social capital in the conversion and privatisation process (so called Parts of the campsite owned by the Republic of Croatia). In the meantime, on 1 April 2022 the Company, in accordance with Article 18) of the Act on Non-Evaluated Construction Land, obtained from the Centre for Restructuring and Sales the Certificate of Conformity of the Geodetic Survey Report, which confirms the conformity of the Park Soline Campsite Geodetic Survey Report with

the decision of the Croatian Privatisation Fund of 12 July 1996, by which the real property concerned was evaluated in the process of conversion of the socially-owned enterprise "Ilirija" Biograd na Moru.

Furthermore, the legislator also adopted the Ordinance on the Arrangement of Leases on Parts of the Campsites Owned by the Republic of Croatia (OG 16/24) (hereinafter: Ordinance on the Arrangement of Leases) which, as a by-law, has been in force since 9 February 2024, and which determines the methods and conditions of payment of fees for the lease of unvalued parts of the campsite. The Republic of Croatia, through the departmental Ministry of Physical Planning, Construction and State Assets, in a letter dated 22 April 2024, invited ILIRIJA d.d. to pay the lease fee based on the aforementioned Ordinance, and Ilirija d.d. was calculated lease fee for the period from the date of entry into force of the Act on Unvalued Construction Land until 31 December 2023. (05/2020 – 12/2023) in the total amount of EUR 538,912.31. The amount determined in this way, in accordance with the Ordinance on the Arrangement of Leases, represents 50% of the lease fee for the "Park Soline" campsite, while the remaining 50% of the lease fee shall be calculated according to the decision from Article 17.1 of the Act on Unvalued Construction Land, i.e. the conclusion of a 50-year lease agreement in accordance with the Act. For the next period starting from 2024, the competent Ministry determined the annual lease fee for the "Park Soline" campsite in the amount of EUR 171,624.15, payable in 12 equal monthly instalments, and has issued the lease fee invoices to ILIRIJA d.d. ILIRIJA d.d. has duly paid the aforementioned annual lease fee for the year 2024, which amount in accordance with the Ordinance on the Arrangement of Leases, represents 50% of the lease fee.

Also, the Company published on its website and on the website of the Zagreb Stock Exchange the "Study of the uniqueness and sustainability of the "Park Soline" campsite in Biograd na Moru as an economic and functional-technological unit within the business system of Ilirija d.d.", which addresses all relevant issues concerning the "Park Soline" campsite in the context of the application submitted by Ilirija d.d., in accordance with the Act on Non-Evaluated Construction Land, for exercising the right to a long-term lease of the "Park Soline" campsite for a period of 50 years. The purpose of the aforementioned Study is to enable all stakeholders, entities and public bodies that are directly or indirectly involved, within their respective spheres of competence, in resolving the issue of campsite land that was not evaluated in the process of conversion and privatisation of socially-owned enterprises, an integral and comprehensive overview of all aspects of the existing "Park Soline" campsite in Biograd, from complex relations regarding property rights, issues of spatial planning and the need to respect the campsite as an integrated business and functional unit of tourist land and buildings. The Company maintains that, in accordance with the Act on Non-Evaluated Construction Land, it meets the requirements stipulated by the Act for exercising the right to lease construction land in the Campsite for a period of 50 years.

Maritime domain

The Company is a concessionaire of the Kornati nautical tourism port in Biograd na Moru (hereinafter: Marina Kornati) for a period of 32 years, counting from 13 January 1999, and in accordance with Article 22 of the Act on Maritime Domain and Seaports (Official Gazette Nos 153/2003, 100/04, 141/06, 38/09, 123/11 and 56/16, hereinafter referred to as: ZPDML 2003) on 17 October 2017 the Company submitted to the Government of the Republic of Croatia, through the competent Ministry of the Sea, Transport and Infrastructure of the Republic of Croatia, a request for modification and amendment of the Decision on Concession and the Concession Agreement, that is, for extending the term of the concession by a period of 50 years, i.e. until the year 2049 (extension of the concession term if new investments are economically feasible for it), primarily considering the same or similar cases from the recent Croatian practice where, upon an application for the extension of the concession term submitted by other companies engaging in nautical tourism and competing with Ilirija d.d., the concession term for marinas was extended to them by a period of 50 years.

As no meritorious decision was made on the said request, on 11 July 2018, Ilirija d.d. delivered to the Ministry of Maritime Affairs, Transport and Infrastructure a letter informing them of having procured an amendment to the construction permit for the reconstruction of the marina, as part of the new investment included in the application for an extension of the concession licence validity. Moreover, on 6 October 2021, the Company delivered a letter to the Ministry of Maritime Affairs, Transport and Infrastructure and the Ministry of Finance of the Republic of Croatia, so as to initiate the adoption of the decision regarding an extension of the concession licence validity.

In the meantime, on 02 November 2021, the Company received a statement from the Ministry of Finance of the Republic of Croatia, as a body which, along with the competent Ministry of the Sea, Transport and Infrastructure of the Republic of Croatia, is involved in the procedures for extending the terms of concessions, in which they essentially point out that in order to conduct the procedure for extending the concession agreement, the competent Ministry of the Sea, Transport and Infrastructure, while looking at the problems of the nautical tourism system, needs to establish whether the decision on the concession or the agreement related to it may be changed without conducting a new procedure for granting the concession, in order not to violate the principle of market competition with other concessionaires in the Republic of Croatia.

Considering the statement of the competent authorities and the expressed views, in order to successfully complete the procedure for extending the concession licence for Marina Kornati, Ilirija d.d. sent a supplement of the existing request for extension of the concession licence validity for Marina Kornati to the Ministry of the Sea, Transport and Infrastructure on 28 December 2023, in which it essentially offered: a new increased amount of investment in the maritime domain (superstructures and substructures), new increased investments in the green transition, including the decarbonisation and digital transformation in accordance with Regulation (EU) 2020/852 of the European Parliament and Council of 18 June 2020, on establishing a framework for facilitating sustainable investments and amending Regulation (EU) 2019/2088 Official Journal of the European Union, L 198/13, in the total amount of new investments of: EUR 5,705,066.00, for which the Company has mostly obtained valid building permits and which ensure orderly and legal performance of marina activities with regard to existing technical, technological and environmental requirements for operation in the period until the expiry of the concession. Also, the Company proposed new amounts of concession fees with reference to previous revalued investments in Marina Kornati, which, in the period from 2000 until the end of 2023, amounted in total: EUR 16,013,277.44, all in order to show the actual absolute value of the investments to date, and the Company also explained the legal issues relevant for making a positive decision, in accordance with the transitional and final provisions of the new Act on Maritime Domain and Seaports (Official Gazette no. 83/2023, hereinafter: ZPDML23), which entered into force on 29 July 2023, so that the procedures for granting and modifying concessions that were started according to the provisions of ZPDML03 have to be completed in accordance with the provisions of that Act. No decision has been rendered yet on the alleged supplemented request for an extension of the concession licence validity for Marina Kornati.

As regards the Ilirija-Kornati Hotel Port in Biograd na Moru, the Company delivered to the Republic of Croatia (Zadar County) on 19 January 2011 a request with detailed explanations for an extension of the concession licence validity for a period of 20 years, but the competent authority of the regional self-government unit has not reached a decision on this Request by Ilirija d.d. Furthermore, and with regard to the above, in February 2015, the Company once again, pursuant to Article 22 of the Maritime Domain and Seaports Act (new investment), submitted a request to the Zadar County regarding an extension of the concession licence validity for the Ilirija-Kornati Hotel Port, for a period of 30 years in total, but a decision has not been made regarding this request by Ilirija d.d. As regards a beach facility with an outdoor swimming pool in Biograd na Moru, the Company submitted to the concession licence grantor, Zadar County, a request for an extension of the concession licence validity for a total of 30 years (until 2028) with all the necessary documentation, back on 20 October 2008 (before the expiry of the concession licence validity). The competent authority still has not decided on this request. The company has been paying the concession fee in the agreed amount for all of the aforementioned facilities this whole time.

On 24 June 2022, the Company published on its website and on the website of the Zagreb Stock Exchange the research paper of Assoc. Prof. Iva Tuhtan Grgić, PhD, from the Faculty of Law in Rijeka "Acquired rights and legitimate expectations of former holders of the right of use of the maritime domain for an indefinite period as well as for a limited period for as long as economic activity is being carried out", which precisely on the example of Ilirija d.d. addressed the issues of legal capital investments on the maritime domain, conversion of socially-owned enterprises that had part of their assets on the maritime domain, issues of acquired rights and legitimate expectations of former holders of the right of use of the maritime domain, and conversion of the right of use into a time-limited concession. In particular, as it is stated in the aforementioned research paper, the companies that had the permanent right of use of the maritime domain, acquired on the basis of final administrative decisions of municipal assemblies, had indisputably acquired rights and legitimate expectations that they would be able to use these rights in the future under the same conditions under which they were acquired. However, by decisions adopted on the basis of the legislation in force at the time, the aforementioned right of permanent use of the maritime domain was subsequently converted into the right of economic exploitation of the maritime domain based on a time-limited concession. This violated the interests of companies, shareholders and acquirers of shares in these companies, by grossly encroaching on the acquired rights and legitimate expectations that they will be able to use the acquired rights within the same scope as when they acquired them, and those same rights are protected by the provisions of the Constitution of the Republic of Croatia (Articles 48(1) and 49(2) and (4)) and Article 1 of Protocol No. 1 to the Convention for the Protection of Human Rights and Fundamental Freedoms.

On 14 July 2023, the Croatian Parliament adopted a new Maritime Domain and Seaport Act, which entered into force on 29 July 2023. It is evident that the new Act has a series of new provisions, and a certain amount of time will need to pass before we are able to fully assess its effect on complex matters in the area of legal investments in the maritime domain before and after the conversion, evaluation and entering in the share capital of former social enterprises, as well as on acquired legal and legitimate expectations of companies who perform legal activities in maritime domains. domain, acquired on the basis of final administrative decisions of municipal assemblies, had indisputably acquired rights and legitimate expectations that they would be able to use these rights in the future under the same conditions under which they were acquired. However, by decisions adopted on the basis of the legislation in force at the time, the aforementioned right of permanent use of the maritime domain was subsequently converted into the right of economic exploitation of the maritime domain based on a time-limited concession. This violated the interests of companies, shareholders and acquirers of shares in these companies, by grossly encroaching on the acquired rights and legitimate expectations that they will be able to use the acquired rights within the same scope as when they acquired them, and those same rights are protected by the provisions of the Constitution of the Republic of Croatia (Articles 48(1) and 49(2) and (4)) and Article 1 of Protocol No. 1 to the Convention for the Protection of Human Rights and Fundamental Freedoms.

On 14 July 2023, the Croatian Parliament adopted a new Maritime Domain and Seaport Act, which entered into force on 29 July 2023. It is evident that the new Act has a series of new provisions, and a certain amount of time will need to pass before we are able to fully assess its effect on complex matters in the area of legal investments in the maritime domain before and after the conversion, evaluation and entering in the share capital of former social enterprises, as well as on acquired legal and legitimate expectations of companies who perform legal activities in maritime domains.

VAT rate on services in tourism and hotel industry

Bureaucracy and administrative barriers

Complex and time-consuming procedure of issuing spatial plans

Making urban and spatial plans

Management of the area

Fiscal charges

Skilled labour shortages

3 Tourism activity risks

In addition to the listed and described potential and possible risks in the Company's business operations, we believe that it is of the utmost importance to give a systematic overview of other key obstacles or restrictions with regard to the development of Croatian tourism in general, and thus of tourism companies, Ilirija d.d. being one of them.

With regard to the forgoing, we present an overview of the key obstacles, that is, of the risks and restrictions with regards to development of and investments in Croatian tourism:

(I) the unresolved issue of ownership since the moment of conversion, that is, property-legal, physical planning-urban and economic use and utilization of the construction tourism land in campsites and around hotels,

(II) inadequately resolved or unresolved issue of conversion on the maritime domain, i.e. issues regarding acquired rights, legitimate investments and legitimate expectations in the maritime domain, having in mind, in particular, the contracted permanent right of use of the maritime domain, while companies which took part in the conversion process, as is the case with our Company, carry out economic activity on the maritime domain, contrary to the provisions of Article 49 and Article 50 of the Constitution,

(III) VAT rate on services in tourism and hotel industry is much higher than in competitive countries, which consequently makes Croatian tourism less competitive, hinders and slows down further investments both in the construction of new accommodation facilities and in improvement of the existing services and standards, affects new employment and salaries in tourism and hospitality,

(IV) insurmountable obstacles regarding existing bureaucracy, administrative barriers, frequent changes to regulations,

(V) complex and time-consuming procedure of issuing spatial plans and issuing building and operating permits,

(VI) inadequate management of the area by regional or local self-government,

(VII) cancellation of previously acquired rights in urban and spatial plans through conversion of use primarily of construction and tourism land for other non-commercial and non-economic purposes,

(VIII) fiscal and parafiscal charges unsuitable to seasonal business activities with frequent changes in fiscal regulations.

(IX) skilled labour shortages were significantly pronounced in 2023 in the Republic of Croatia, namely at the level of most economic activities, and with a special emphasis on hospitality and tourism taking into account the seasonal nature of Croatian tourism, as well as the fact that it is an extremely labour-intensive industry; therefore, skilled labour shortages (with a special emphasis on occupations in high demand) could affect the success of the peak season, and thus ultimately of the entire business year. Bearing in mind all of the above, the Company has recognized risks pertaining to the said skilled labour shortages, and it undertakes a series of activities to retain working-age, highly qualified and professional employees at all levels for business operations, namely with the aim of retaining full employment, raising the level and quality of services, and achieving smooth operation of business processes through activities aimed at improving the financial standing of employees, investing in their education, and further developing human resources by hiring young, highly educated persons from different professions.

4 Global risks and the macroeconomic environment

Considering the global nature of the hospitality and tourism industry, different events and activities at the global level can significantly affect the operations of tourism companies. As such, the said industry is influenced by geopolitical risks with strong implications for security and stability at the global level, the security, political and economic instability of the region, i.e. of the countries in the immediate vicinity of the Republic of Croatia, the global economic crisis, global health threats such as pandemics and epidemics, as well as the climate impact risk. In today's globalised world, the said risks affect the free movement of people, goods and capital, i.e. national economies and operations of economic entities. In addition to the aforementioned risks referred to in points 1 – 3, the most significant global risks for the Company's operations are: the health risk, the geopolitical risk, the climate impact risk, the macroeconomic environment and information security risk.

Health risk

Since 2020, the world faced an unpredictable, serious and extremely dynamic risk related to the epidemiological situation, i.e. the global COVID-19 pandemic, which has had an extremely negative impact on business entities in almost all industries, albeit the most severely affected ones are certainly the travel industry, tourism and hospitality, all of which form an integral part of the Company's core business. The COVID-19 risk is also the biggest and most serious risk that the Company has faced so far, to which the Company responded with a number of measures and activities by reorganising its business processes and operations in order to safeguard the health and well-being of guests and employees, maintain financial stability and current liquidity for the duration of the COVID-19 pandemic, preserve assets and capital as well as business operations and activities, and retain full employment. The Company has successfully achieved all of its goals. The Company continues to implement different preventive activities within its business processes and operations in order to reduce and always be able to control health risks, just like it did during the COVID-19 pandemic. However, the Company is also aware of the related limitations and the unpredictability of easily transmissible infectious diseases and the threatening consequences of their spread.

Geopolitical risk

Due to the war in Ukraine, geopolitical risk with strong implications for European and global security and the macroeconomic environment has been present since February 2022. Therefore, the Company also reports on such risks and their consequences on its operations. The Company does not have any kind of an ownership relationship with

entities from Russia and Ukraine. Moreover, it does not have any assets in Russia and/or Ukraine, and it has not made any investments in entities from Russia and Ukraine or entities materially related to entities from Russia and Ukraine. Thus, the Company is neither exposed nor are there any potential consequences in this respect. Moreover, the Company has no exposure to entities from Russia or Ukraine since it does not do business with legal entities from Russia or Ukraine. The Company does business as a company specialised for hospitality and tourism has a business relationship with natural persons from Russia and Ukraine using the Company's services such as accommodation in its facilities (hotel, camping and nautical sectors). The share of guests from Russia and Ukraine in the Company's total turnover is insignificant, and losing it does not represent a risk to the Company. Should the crisis, that is, the war, spread from Ukraine to other European countries or lead to destabilisation of the countries in the Balkans, this would surely have a negative effect on Croatian tourism as a whole, and thus also on the Company. Croatian tourism generates most of its turnover from the European outbound market, the share of which additionally increased due to the global COVID-19 pandemic and a lack of tourism turnover from remote markets (America, Asia). This turnover could be significantly reduced in case the Russian-Ukrainian crisis, that is, the war, spreads across Ukrainian borders and causes major instability in the wider European region. The Company will counteract any potential negative effects of the Russian-Ukrainian crisis by adjusting its business processes and activities to the new circumstances, with the aim of strengthening the resilience of its business system.

Climate impact risk

The Company bases its business policy on management in line with the principles of sustainable and responsible development, with particular focus on environmental protection, as the environment is the fundamental resource of the tourism industry. Environmental protection represents a significant segment of the Company's integrated management systems and is a part of its strategic decisions and business processes.

The consequences of climate change are becoming increasingly influential when it comes to almost all activities. In the tourism sector and within the Company, they have been recognized as climate impact risks requiring an interdisciplinary approach and management. The Company continuously monitors its impact on the climate, i.e. its greenhouse gas emissions and other environmental impacts, namely in accordance with all applicable legal regulations and prescribed limit values.

The Company has previously recognized its impact on the environment and decided on a systematic approach with a series of activities it carries out. They mainly pertain to the preservation of natural resources (water, air, soil, and

coast), biodiversity, energy management, and waste management, which ultimately confirms the Company's focus on sustainable development and growth. The identified risks included the dangers brought on by climate change both at the global level and at the level of the Company's operations. We also noticed that extreme weather conditions can affect tourist demand and cause direct material damage to the Company's assets.

Climate change, which has a significant impact on the tourism industry globally, also poses a potential risk to the Company in terms of significantly increasing the incidence of extreme weather conditions (storms, hurricanes, etc.), as well as strengthening their intensity and unpredictability, and can cause extraordinary and unpredictable damage and threats for its business. Temperature variability, i.e. dangerous heat waves, reduce the attractiveness of our offer in holiday capacities. This directly affects arrivals and quality of stay. Rising sea levels put the infrastructure in the immediate vicinity of the coast at risk. The same also applies to the marina, arranged beaches, and beach facilities. Unpredictable windstorms or hurricane-force winds can cause direct damage to almost all our capacities. The Company pays maximum attention to overcoming such sudden and extreme climate and weather conditions by ensuring preventive, technical and spatial, as well as functional and organizational elimination of sudden and accidental risks of any nature to the highest degree possible. Other business risks, such as large-scale fires, accidental pollution of the coastal and marine aquarium, which are beyond the Company's control, but may potentially jeopardize the Company's business safety, are the circumstances which the Company attends to insofar as it can actively contribute to as low impact on the Company's long-term business viability as possible, being aware of the fact that the impact here is reduced to measures which cannot be of key importance to the elimination of all the risks posed to the Company.

Macroeconomic environment

The unfavourable macroeconomic environment, i.e. significant economic uncertainties resulting partially from the global pandemic that affected supply chains, and partially from the Russian-Ukrainian war, led to disruptions in the supply of basic energy products in the euro area and resulted in a significant increase in the prices of all energy products (oil, gas, electricity), and ultimately strong inflationary pressures. An uncertain macroeconomic environment can affect the Company's business activities by reducing the demand for its services as it significantly contributes to the deterioration of the business climate in the key outbound markets for Croatian tourism. This could also result in a slowdown in economic activities and a decrease in purchasing power and standards, as well as, ultimately, in a decrease in travel demand, which would definitely affect the achievements of Croatian tourism companies, including our Company. The company is aware of the challenges and risks arising from the unfavourable macroeconomic

environment, and it undertakes a number of activities aimed at preserving its core business objectives (economic viability and security, financial stability, preservation of the Company's fixed assets and capital, and preservation of the Company's business operations and activities), as it did in previous years, namely based on: (I) commercial resilience – based on the Company's ability to quickly and efficiently adapt to the current market circumstances of doing business by adjusting its marketing and sales activities in all Company sectors, (II) operational resilience – based on the ability to adjust operational business processes to the current circumstances whilst maintaining maximum service and amenity quality and minimising possible negative effects, and (III) financial resilience – based on the Company's ability to maintain financial stability of the business system by maintaining liquidity, assets and business activity through the realisation of revenue ensuring the Company's business stability until key global and macroeconomic uncertainty factors end.

Information system security with a particular focus on cybersecurity

The increase in threats to the information security of business systems on a global level together with the increasing and more complex digitalisation of business processes make the information systems of companies more exposed to various forms of security threats. As a result, the Company, in order to raise the level of information security and resilience with a particular focus on cybersecurity, maintain the stability and continuity of operations and preserve information and data, actively works to protect the security of the information system by the strengthening and adapting information system security standards and practices, training employees, performing regular system updates, controlling supply chains of digital services and implementing new security technologies.

3.8 Dialog with Stakeholders

Balancing the rights, obligations and interests of all stakeholders of the business process in the Company's entrepreneurial business venture is founded on the relationship with stakeholders.

The stakeholders are divided into:

• affected stakeholders: (customers/guests, employees, shareholders)
• users of declarations of sustainability: local community, the state, suppliers and financial institutions)

Affected stakeholders:

Customers/guests - they are at the core of our company's service. They are categorized as follows: individual customers/guests, travel agencies, tour operators, corporate partners. The Company relies on the principle that all data, information, descriptions and representations of products and services in different forms of marketing communication, through advertising, publicity and sponsorship, must be credible, true, timely and up-to-date, without undermining competing products and services, and along with the protection of the consumers' privacy and their rights, as well as respect for human dignity.

Communication with guests/customers was conducted through: customer satisfaction monitoring, regular interaction with key customers, newsletters, trade fairs, B2B workshops, as well as via the company's website and social media.

Employees – recognizing that employees are the driving force behind every business system and process, the company continued to prioritize the retention of skilled, highly qualified professionals in 2024 by further strengthening key sectors and departments, improving their material conditions, offering training at all levels, and ensuring attention to their health and safety. As at 31 December 2024 the Company has 306 employees.

Communication with employees was carried out through daily, weekly, and monthly operational meetings, executive and management board meetings, email notifications, annual employee gatherings, internal notice boards, and social media.

Shareholders (owners) or holders of capital exercise their rights through the General Assembly, which is composed of all holders (owners) of the Company's securities or shares. As at 31 December 2024, the Company had a total of 249 shareholders, who held a total of 2,413,488 shares. In 2024, the Regular General Assembly of the Company was held on 26/02/2024, and the Extraordinary General Assembly was held on 25/10/2024. As legally required, the decisions of the general Assemblies were published and are available on the website of the company (www. ilirijabiograd.com), the Zagreb Stock Exchange (www.zse.hr), HANFA and the officially appointed mechanism for the central storage of regulated information – SRPI (www.hanfa.hr), as well as the Croatian News Agency (www.hina.hr), and they were submitted to the Register of the Commercial Court, namely in accordance with legal regulations. All decisions of the General Assembly are listed in the chapter "Significant Events".

The Company maintains regular communication with its shareholders through: general meeting, financial reports (annual, semi-annual, and quarterly), corporate disclosures, corporate website, and sustainability reports.

Users of sustainability statements:

The government and the local community – the Company, as the leading economic entity at the local level, as well as one of the three leading companies in the region and 20 leading tourism companies in the Republic of Croatia, creates new values; that is, products and services, creates new jobs and employs locals, develops the destination offer and implements corporate philanthropy activities thereby contributing to the active development of tourism as one of the key industries in the Republic of Croatia, in accordance with the legal regulations and codes of conduct.

Communication with the government and the local community was carried out through membership in business and professional associations, participation in local, regional, and national tourism boards, involvement in legislative initiatives, independently or via professional associations, attendance at conferences and lectures, corporate announcements and media releases, and sustainability reports.

Suppliers – they contribute to the overall service quality and the creation of additional value for the Company, and consequently enhance the enjoyment for our end users – our guests.

The company strives to establish strategic, long-term, and quality mutually beneficial relationships with suppliers, aiming to create value for the company, its guests, and the local community. This is achieved through knowledge exchange, business process improvement on both sides, and the development of high-quality products. Communication with suppliers was conducted via meetings, presentations, workshops, visits, and mutual sharing of knowledge and experience.

Financial institutions – in 2024, the Company continued its long-term process of improving its reporting system, with an emphasis on transparency, comprehensiveness, completeness and timeliness of disclosure of all key financial and operational performance indicators, as well as corporate notifications and actions. The Company's stakeholders, including the commercial bank and the leasing Company, as financial institutions, with which the Company has a long-standing relationship based on mutual trust and cooperation aimed at encouraging its long-term responsible and sustainable development and growth, in the best interest of all its stakeholders.

Communication with financial institutions was conducted through the timely publication of financial reports and corporate disclosures, operational transparency, and collaboration based on mutual trust.

Material topics

To prepare the Sustainability Report for 2024, the Company used data from the last conducted identification of material topics in 2018, taking into consideration the fact that the communication with shareholders demonstrated that there had been no significant change in material topics, so that material topics were not defined in 2024. In accordance with the new regulatory obligations stemming from the Directive on Corporate Sustainability Reporting and its amendments as part of the OMNIBUS package, as well as the European Sustainability Reporting Standards and expected regulatory developments, the company will undertake a new materiality reassessment process in the upcoming period.

The consultation with the stakeholders were carried out in such a way that we invited them to participate in the process of defining key material topics with respect to their expectations, interests and priorities as well as the importance and impact of material topics on them as our stakeholders, namely by responding to a survey which was published on the company's website so it would be accessible to all representatives of the stakeholders and in order for the process to be transparent.

In the survey, we organised 15 material topics into three categories:

• economic (economic impact, market presence, indirect economic impacts, procurement practices),
• environmental (energy, water, waste waters and waste, adherence to environmental regulations), and
• social (employment, occupational health and safety, training and education, diversity and equal opportunities), local communities, customer health and safety, marketing and labelling)

Material topics were rated with a score ranging from 1 as the lowest impact to 5 as the highest impact.

Stakeholders from twenty different organisations and six stakeholder groups participated in the process of identifying material topics. After consulting with stakeholders on the perception of particular material topics, the identified material topics were then prioritised or evaluated in relation to the Company's impact on the environment, society and economy, resulting in the development of a materiality matrix. In the materiality matrix, material topics are identified and evaluated with respect to their impact on stakeholder decisions, as well as economic, environmental and social impacts of the company on others.

Economic topics:

• Economic performance
• Market presence
• Indirect economic impacts
• Procurement practices

Environmental topics:

• Energy
• Water
• Waste waters and waste
• Compliance with environmental protection
• regulations

Social Topics

• Employment
• Occupational health and safety
• Training and education
• Diversity and equal opportunities
• Local communities
• Customer health and safety
• Marketing and labelling

Material topics were rated with a score ranging from 1 as the lowest impact to 5 as the highest impact. Stakeholders from twenty different organisations and six stakeholder groups participated in the process of identifying material topics. After consulting with stakeholders on the perception of particular material topics, the identified material topics were then prioritised or evaluated in relation to the Company's impact on the environment, society and economy, resulting in the development of a materiality matrix. In the materiality matrix, material topics are identified and evaluated with respect to their impact on stakeholder decisions, as well as economic, environmental and social impacts of the Company on others.

Following the survey, identified material topics were perceived as important given that no material topics scored under 4.33.

4.1 Management of the Economic Aspect of Business

For Ilirija as a company, economic sustainability is the fundamental pillar of conducting business responsibly and sustainably. By achieving the set business goals, a basis for achieving environmental and social sustainable development goals is created. Considering that, when conducting business, focus is placed on regions, the limits of impact primarily occur at local and regional level, i.e. at the location of the business activities and at the national level, considering the overall contribution to the development of the Croatian tourism industry.

The Company manages the economic aspects of business by adopting a Business Plan, i.e. budget on a yearly basis, at the level of the company and each sector or profit centre individually, consolidated by the Accounting and Finance Department or the Controlling, Planning and Analysis Service, and drawn up following the basic financial goals of the company for the next financial year. The Business Plan, i.e. budget and business reports are adopted by the Management Board, and they provide a true and fair overview of the situation in the company, as well as its operating results and cash flows as determined by the Supervisory Board and taken note of by the General Assembly.

4.2 Operating Results in 2024

Business year 2024 also saw continued business growth, achieving the best results to date at the level of all sectors individually and overall at the Company level. The achieved results stem from the growth of business activities in the tourism sectors expressed through the growth of key physical indicators, strengthening of year-round operations by increasing business activities in the pre- and post-season, followed by the growth of revenue and profitability that were simultaneously accompanied by the growth of the results of the real estate sector, as a result of which the Company achieved the best results in terms of revenue, total and business, while at the same time further strengthening the capital and balance sheet position, reducing total liabilities and having the lowest net debt to date.

Total revenues amounted to EUR 30,685,992.57, representing an increase of 8.48%, while operating revenues amounted to EUR 30,351,531.83, representing an increase of 8.21% compared to the previous year. All sectors recorded revenue growth, led by a notable 43% increase in revenues from the destination management company. Hotel operations reported a 9% increase, the nautical sector grew by 9%, real estate revenues rose by 5%, and the camping sector achieved a 3% increase.

Furthermore, the Company recorded growth in key business profitability indicators (EBITDA, EBIT, operating profit, profit before tax and net profit) compared to the previous business year, while some profitability indicators are the best to date. EBITDA was realised in the amount of EUR 8,120,672.86, a 4.17% increase, while EBIT amounted to EUR 1 Achieved the strongest business results since the company's commencement of activities (physical indicators, revenue, profitability, and financial position metrics).

2 Continued growth in business activities across all tourism sectors, with a significant increase in year-round operations.

3 Maintained a high level of resilience, competitiveness, service quality, and standards in a challenging and demanding macroeconomic environment.

4,896,264.66, constituting an increase of 7.46%. Operating profit was generated in the amount of EUR 7,786,212.12, representing a growth of 3.03%, while profit before tax was realized in the amount of EUR 4,434,043.96, reflecting a growth rate of 8.93%. Net profit amounts to EUR 3,576,074.33, which is an increase of 9.05%. At the same time, total liabilities in the reporting period amounted to EUR 16,862,887.68, recording an 8.58% decrease. Furthermore, net debt amounted to EUR 539,116.87, recording an 83.13% decrease, which means that the Company continued to reduce its liabilities in 2024, especially with regard to net debt, which was the lowest to date, with an increase in the self-financing rate, i.e. further strengthening the overall capital, financial and balance sheet position.

In the circumstances in which business was conducted in 2024, the Company achieved growth in business activities at the level of all sectors, growth in key physical and financial indicators, achieving satisfactory profitability, strengthening the balance sheet and capital position, competitiveness and stability of operations, i.e. had another successful business year.

Physical operating results

In 2024, the Company achieved revenue growth across all sectors and growth in key market and physical performance indicators, recording the best operating results to date in terms of revenue at the level of each individual sector, and certain sectors also recorded growth in business profitability. Despite the strong resurgence of competing Mediterranean tourist destinations and the slow recovery of the European economy, the growth of business activities in the tourism sectors, alongside the expansion of year-round operations through the Ilirija Travel destination management company, resulted in satisfactory business profitability. Consequently, this led to the company's strongest financial performance to date.

Overview of key physical indicators of business activities in 2024

Physical indicators	2024	2023	Index 2024/2023
Hotel sector
Number of accommodation units	435	435	100,00
Overnight stays of tourists	126.130	118.680	106,28
Occupancy days	140	135	103,70
Annual occupancy	38,35%	36,95%	103,79
Nautics
Number of berths	805	805	100,00
Contracted vessel	754	747	100,94
Transith berth, overnight stays of vessels	7.179	8.127	88,34
Transith berth, inbound sail of vessels	2.816	3.094	91,01
Port service - number of operations	4.000	3.817	104,79
Days of work	365	365	100,00
Camping
Number of accommodation units	1.130	1.130	100,00
Days od work	198	198	100,00
Occupancy days	116,24	120,62	96,37
Mobile homes	87,76	89,35	98,22
Individuals	48,40	56,75	85,29
Fixed lease	198,00	198,00	100,00
Lump sum	198,00	198,00	100,00
Occupancy	58,71%	60,92%	96,37
Mobile homes	44,33%	45,13%	98,23
Individuals	24,44%	28,66%	85,28
Fixed lease	100,00%	100,00%	100,00
Lump sum	100,00%	100,00%	100,00
Overnight stays of tourists	321.016	329.010	97,57

Overview of key physical indicators of business activities in 2024 (continued)

Physical indicators	2024	2023	Index 2024/2023
Ilirija Travel
Number of events	295	234	126,07
Number of persons (events)	40.424	30.560	132,28
Real-estate
Number of leesses	36	35	102,86
Common expenses	34	33	103,03
Common areas	24	26	92,31
Advertising space	8	8	100,00
Garage - number of parking spaces	410	410	100,00
Rented area (m2 )	9.445,32	9.445,32	100,00
Number of vehicle	734.990	729.225	100,79

Hotel sector

2024 was marked by continued growth in demand for hotel capacity, which resulted in an increase in business results, both physical and financial, with an added increase in the number of accommodation units sold, occupancy of accommodation units and occupancy days. In terms of physical business indicators, 42,573 arrivals and 126,130 overnight stays were recorded, compared to 37,500 arrivals and 118,680 overnight stays in 2023, recording a double-digit increase – arrivals by 14% and overnight stays by 6%.

Revenue amounted to EUR 9,797,346.04, representing an increase of 9% as compared to EUR 9,021,921.78 realised in the previous year. Moreover, there was a significant increase in revenue per accommodation unit (RevPAR) with regard to days of availability – by 9%, i.e. EUR 77.60 compared to EUR 71.22 realised in the previous year. At the same time, the average daily rate per accommodation unit (ADR) amounted to EUR 134.44, compared to EUR 126.50 realised in 2023, recording a 6% increase.

With the growth of revenue while simultaneously managing costs, the gross operating profit (GOP) at the level of the hotel sector was realised in the amount of EUR 2,313,533.70, constituting an increase of 9%, while GOP per accommodation unit amounted to 5318.47 EUR, recording an increase of 9%.

Key market and financial indicators of hotel sector

	2023	2024	2024/2023
HOTEL SECTOR - MARKET INDICATORS
Average daily rate of the accommodation unit (ADR) *	126,50 €	134,44 €	6,28%
Revenue per accommodation unit (RevPAR) on a total number of days basis in period **	46,74 €	51,56 €	10,32%
Revenue per accommodation unit (RevPAR) on an open days basis **	71,22 €	77,60 €	10,98%
HOTEL SECTOR - FINANCIAL INDICATORS
Operating revenues	9.021.921,78 €	9.797.346,04 €	8,59%
Revenues from board services	7.420.735,60 €	8.209.077,58 €	10,62%
TRevPAR ***	20.740,05 €	22.522,63 €	8,59%
Operating costs ****	6.898.386,63 €	7.483.812,34 €	8,49%
Gross operating profit (GOP) *	2.123.535,15 €	2.313.533,70 €	8,95%
GOP per accommodation unit	4.881,69 €	5.318,47 €	8,95%
GOP margin**	23,5%	23,6%	0,32%
Capital investments	855.035,16 €	335.087,44 €	-60,81%

Notes:

Hotel sector of Ilirija d.d. includes hotels (Ilirija, Adriatic, Kornati and Villa Donat) and selected profit centres operating within the hotel sector (Lavender bar, Aquatic Centre and "Ilirija" Tennis Centre).

* ADR - Average daily rate of the accommodation unit is calculated on the basis of the revenue from board services (revenue from the accommodation and food and beverages of the board services).

** RevPAR - Revenue from the board services per accommodation unit includes the revenue from the board services (revenue from the accommodation and food and beverages of the board services) divided by the number of the available accommodation units in a given period (365 days; number of open days).

***TRevPAR (Total annual revenue per accommodation unit) - Denotes the total operating revenue of the hotel sector divided by a number of physical accommodation units.

****Operating costs include the costs of raw material and material, costs of services, gross pays and other operating costs, not including the depreciation, financial expenses and extraordinary expenses.

***** GOP - Denotes a gross operating profit of the hotel industry before the allocation of costs of common services, and is calculated in the following way: operating revenues – operating expenses (before allocation, without depreciation and fixed costs).

****** GOP margin is calculated by correlating the amount of GOP before the allocation of costs of common services and operating revenues.

Nautical sector

The nautical sector had another record business year with the best business and financial result to date, generating revenue in the amount of EUR 9,117,404.00, i.e. 9% higher compared to 2023, when revenue amounted to EUR 8,383,127.00.

The revenue growth of the nautical sector is attributable to a significant increase in income generated by its two key profit centres: Marina Kornati and the Nautical Fair. Marina Kornati recorded total revenue of EUR 7,462,351.00, representing an increase of 8% compared to 2023. The most significant increase in Marina Kornati's revenue is due to an increase in the revenue from contractual berths, which equalled EUR 5,485,984.00 in the reporting period, representing a 7.37% increase in comparison to the same period of 2023. The Nautical Fair profit centre delivered a strong financial performance, generating EUR 1,025,776.00 in revenue, a 23% increase.

In terms of key operational indicators pertaining to vessels under contract berth, the most significant physical performance metric for Marina Kornati, a total of 754 berth usage agreements were concluded, reflecting a 1% increase compared to the previous year. During the reporting period, individual vessels accounted for 52% of the total contracted berths, while charter vessels represented 48%. This balanced distribution between individual and charter vessels resulted in a 7% increase in contract berth revenue compared to 2023.

Key market and financial indicators of nautical sector

	2023	2024	2024/2023
MARKET INDICATORS (MARINA KORNATI)
Berth contract:
Revenue from berth contracts	5.109.242,00 €	5.485.984,00 €	7,37%
Aver. revenue from berth contracts	6.839,68 €	7.275,84 €	6,38%
Transit berth:
Revenue from transit berth	443.345,00 €	393.575,00 €	-11,23%
Aver. revenue per overnight stay (transit berth)	54,55 €	54,82 €	0,50%
Servicing:
Revenue from servicing	463.160,00 €	505.960,00 €	9,24%
Aver. revenue per service operation	121,34 €	126,49 €	4,25%
Parking:
Revenue from parking	446.193,00 €	434.155,00 €	-2,70%
Aver. revenue per parking place	892,39 €	868,31 €	-2,70%
Business cooperation:
Revenue from business cooperation	390.084,00 €	436.776,00 €	11,97%
Aver. revenue from business cooperation	7.960,90 €	8.913,80 €	11,97%
FINANCIAL INDICATORS - TOTAL NAUTICS
Operating revenues	8.383.127,00 €	9.117.404,00 €	8,76%
Operating revenues per berth	10.413,82 €	11.325,97 €	8,76%
Operating costs*	3.696.940,00 €	4.013.793,00 €	8,57%
Gross Operating Profit (GOP) **	4.686.187,00 €	5.103.611,00 €	8,91%
GOP per berth	5.821,35 €	6.339,89 €	8,91%
GOP margin ***	56%	56%	0,00%
Capital investments	409.021,00 €	115.745,00 €	-71,70%

Notes:

The Nautics of Ilirija d.d. consists of three business units:Marina Kornati, Boat Show and restaurant of "Marina Kornati

*Operating costs include the costs of raw material and material, costs of services, gross pays and other operating costs, not including the depreciation, financial expenses and extraordinary expenses.

**Gross Operating Profit (GOP) denotes a gross operating profit of the nautics before the allocation of costs of common services, and is calculated in the following way: operating revenues – operating expenses (before the allocation, without depreciation and fixed costs)."

***GOP margin is calculated by correlating the amount of GOP before the allocation of costs of common services and operating revenues.

Camping

The camping sector achieved its best business results to date since the start of its operations, particularly in terms of generated revenue. Regarding key physical indicators, the most significant segment, the "Park Soline" campsite, recorded a slight increase in arrivals, while the number of overnight stays decreased by 2%. Occupancy of camping units based on days of availability was 3% lower compared to 2023. However, the average realized price increased by 9%, resulting in a 6% increase in accommodation revenue per camping unit based on days of availability.

The camping sector, comprised of the "Park Soline" campsite and the "Park Soline" restaurant, generated a revenue of EUR 7,728,416.08, which is a 3% increase compared to the previous year. Analysing by market segments, revenue growth was recorded in own mobile homes with a 7% increase and in lump-sum accommodations with a 16% growth compared to the prior business year.

The camping sector's gross operating profit (GOP) amounted to EUR 3,885,531.73, representing 99% of the gross operating profit achieved in 2023. Furthermore, the gross operating margin for the entire camping sector it amounted to 50.28%, while for the "Park Soline" campsite it amounted to 56.3%

Key market and financial indicators of camping

	2023	2024	2024/2023
MARKET INDICATORS - CAMPSITE "PARK SOLINE"
Average daily rate of the camp unit (ADR)*	49,31 €	53,89 €	9,28%
Revenue from accommodation per camp unit (RevPAR) on a basis of 365 days **	16,25 €	17,13 €	5,40%
Revenue from accommodation per camp unit (RevPAR) on an open days basis **	29,96 €	31,64 €	5,60%
FINANCIAL INDICATORS - TOTAL CAMPING
Operating revenue	7.485.683,10 €	7.728.416,08 €	3,24%
TRevPAR ***	6.624,50 €	6.839,31 €	3,24%
Operating costs ****	3.560.488,25 €	3.842.884,35 €	7,93%
Gross Operating Profit (GOP) *	3.925.194,85 €	3.885.531,73 €	-1,01%
GOP per accommodation unit	3.473,62 €	3.438,52 €	-1,01%
GOP margin **	52,44%	50,28%	-4,12%
Capital investments	1.594.320,76 €	630.529,09 €	-60,45%

Notes:

* ADR - Average daily rate of a camp unit is calculated on the basis of the revenue from accommodation in the campsite and the number of camp units sold.

** RevPAR - Revenue from accommodation per camp unit is the revenue from accommodation divided by a number of available camp units in a given period (366/365 days; number of open days).

***TRevPAR - Total revenue per camp unit denotes total operating revenue of the camping (or the campsite) divided by a number of physical camp units.

****Operating costs include the costs of raw material and material, costs of services, gross pays and other operating costs, not including the depreciation, financial expenses and extraordinary expenses. *****Gross Operating Profit (GOP) - Denotes a gross operating profit of the camping/ campsite / restaurant before the allocation of costs of common services, and is calculated in the following way: operating revenues - operating expenses ( before the allocation, without depreciation and fixed costs).

******GOP margin is calculated by correlating the amount of GOP of camping / campsite / restaurant before the allocation of costs of common services and operating revenues.

Ilirija Travel

As a destination management company, Ilirija Travel develops new services and amenities as a complementary tourism product by integrating all components of the Company and destination links – the goal being the placement of value-added services.

In 2024, the company continued its strong growth by developing new services and offerings through its agency, creating an integrated and complementary tourism product while providing additional services. During the pre-season, strengthened sales and increased arrivals of organized groups led to a higher number of events, participants, and revenue. Total revenue of EUR 1,828,124.91 increased by 26% compared to EUR 1,456,273.18 in the previous year, were realised across other Company's profit centres as well.

Following last year's 234 events attended by 30,560 participants, in 2024 a total of 295 events were held with 40,424 participants. Through specialised programs and events such as concerts, incentives, events, conferences, congresses, weddings, excursions, regattas, and others, the company achieved a robust growth in both physical and financial results, with pronounced increase in demand for excursion programs compared to the previous pre-season. The multi-purpose facility Arsenal in Zadar also experienced an exceptional growth, achieving the revenue of EUR 1,119,178.21 compared to EUR 599,768.83 in 2023, marking an 87% revenue

	Number of events			Number of participants			Total REVENUE
	2024	2023	INDEX	2024	2023	INDEX	2024	2023	INDEX
			2024/2023			2024/2023			2024/2023
TOTAL	295	234	126	40,424	30,560	132	1,828,124.91 €	1,456,273.18 €	126

City Galleria Business and Shopping Centre

The business results achieved in 2024 show a stable and continuous growth of key market indicators in that period. Operating revenues generated from the leasing of commercial spaces, common costs, use of shared facilities within the centre, lease of advertising space, parking garage revenue, and other business revenues amounted to EUR 2,159,072.06, reflecting a 5% increase compared to the previous year.

As at 31 December 2024, a total of 36 commercial lease agreements were active, i.e. the occupancy rate was 99.76% of the indicated net rentable area of the Centre. Furthermore, the revenue growth was accompanied by an increase in the average monthly rent per square meter of commercial space, which reached EUR 11.50, representing a 7% increase. The average rent per square meter for the reporting period similarly grew by 7%, amounting to EUR 138.00.

The gross operating profit for the reporting period equalled EUR 1,079,851.86 before the allocation of common service costs, which represents a 50.01% margin.

Key market and financial indicators of real estate sector - City Galleria

	2023	2024	2024/2023
MARKET INDICATORS
Average monthly rent earned per m² of premises (AMR)*	10,72 €	11,50 €	7,28%
Average rent earned per m² of premises for the period	128,64 €	138,00 €	7,28%
Average revenue from the garage per parking space for the period**	434,74 €	475,95 €	9,48%
COMMERCIAL TURNOVER:
Premises - number of active contracts	35	36	2,86%
Shared costs - number of active contracts	33	34	3,03%
Common areas - number of active contracts	26	24	-7,69%
Advertising space - number of active contracts	8	8	0,00%
Garage - number of parking spaces	410	410	0,00%
Garage - turnover of vehicles	729.225	734.990	0,79%
FINANCIAL INDICATORS
Operating revenues	2.056.050,86 €	2.159.072,06 €	5,01%
Operating costs***	1.023.814,73 €	1.079.220,20 €	5,41%
Gross Operating Profit (GOP) ****	1.032.236,13 €	1.079.851,86 €	4,61%
GOP margin *	50,20%	50,01%	-0,38%
Capital investments	62.956,42 €	83.264,40 €	32,26%

Napomene:

* AMR (Average Monthly Rent) – The average monthly price achieved for m² of the premises is calculated based on the revenue from the rent of premises and net available floor area of active premises.

** The revenue from the garage per parking space is the total revenue from the garage divided by a number of available parking spaces in a given period.

***Operating costs include the costs of raw material and material, costs of services, gross pays and other operating costs, not including the depreciation, financial expenses and extraordinary expenses."

****Gross Operating Profit (GOP) - denotes a gros operating profit of the real estate sector before the allocation of costs of common services, and is calculated in the following way: operating revenues - operating expenses (before the allocation, without depreciation and fixed costs).

*****GOP margin is calculated by correlating the amount of GOP of the real estate sector before the allocation of costs of common services and operating revenue.

Financial operating results

REVENUES	2019	2020	2021	2022	2023	2024	INDEX 2024/2023
Revenue on the domestic market	16.698.613,17	10.480.685,84	14.405.343,69	19.132.960,71	22.562.938,56	25.820.121,17	114
Revenues on foreign market	5.265.553,03	1.498.399,36	2.699.398,25	4.477.288,33	5.345.938,25	4.263.724,09	80
Other operating revenues	295.030,74	980.043,94	742.594,05	121.091,11	138.931,86	267.686,57	193
OPERATING REVENUES	22.259.196,94	12.959.129,14	17.847.335,99	23.731.340,15	28.047.808,67	30.351.531,83	108
FINANCIAL REVENUES	11.366,05	12.901,37	47.829,98	47.144,05	238.931,40	334.460,74	140
EXTRAORDINARY REVENUES	0,00	0,00	0,00	0,00	0,00	0,00	#DIV/0!
TOTAL REVENUES	22.270.562,99	12.972.030,50	17.895.165,96	23.778.484,20	28.286.740,07	30.685.992,57	108
EXPENSES
Raw material and material costs	3.232.619,57	1.472.737,48	2.272.794,39	3.650.771,30	4.046.349,21	4.146.300,75	102
Costs of services	2.874.002,90	2.158.335,52	2.453.538,75	3.307.643,93	4.021.470,79	4.691.843,06	117
Gross pays	5.622.472,88	4.041.577,94	4.506.151,93	6.318.533,25	7.893.199,61	8.763.884,73	111
Other expenses	3.864.149,41	2.473.060,48	2.187.162,13	3.223.613,05	4.529.903,90	4.963.291,17	110
TOTAL EXPENSES	15.593.244,76	10.145.711,43	11.419.647,19	16.500.561,53	20.490.923,51	22.565.319,71	110
AMORTISATION	1.908.478,86	2.080.251,35	2.530.778,27	2.963.899,80	3.239.285,13	3.224.408,20	100
FINANCIAL EXPENSES	610.114,35	610.441,01	446.235,49	454.825,48	486.113,85	462.220,70	95
EXTRAORDINARY EXPENSES	0,00	0,00	0,00	0,00	0,00	0,00	#DIV/0!
TOTAL EXPENSES	18.111.837,97	12.836.403,78	14.396.660,95	19.919.286,81	24.216.322,49	26.251.948,61	108
PROFIT BEFORE TAX	4.158.725,02	135.626,72	3.498.505,01	3.859.197,39	4.070.417,58	4.434.043,96	109
NET PROFIT	4.158.725,02	135.626,72	2.942.793,29	3.117.753,76	3.279.530,22	3.576.074,33	109
OPERATING PROFIT/LOSS	6.665.952,18	2.813.417,71	6.427.688,79	7.230.778,62	7.556.885,16	7.786.212,12	103
EBITDA	6.677.318,23	2.826.319,08	6.475.518,77	7.277.922,67	7.795.816,56	8.120.672,86	104

Revenue by activities:

Hotel sector revenue amounted to EUR 9,797,346.04, representing a 9% increase or EUR 775,424.26 more compared to 2023, when revenues totalled EUR 9,021,921.78. This growth resulted from significant increases in physical traffic, arrivals, and overnight stays, with a particular focus on pre- and post-season business activities, accompanied by improvements in key market and financial indicators, higher capacity utilization, as well as increased occupancy days.

Revenue of the nautical sector reached EUR 9,117,404.47, representing an increase of 9% or EUR 734,277.81 compared to 2023, when revenues amounted to EUR 8,383,126.66. This increase was driven by an 8% growth in accommodation revenue, specifically at Marina Kornati, and a strong 23% increase in revenue from the nautical fair.

Camping revenue amounted to EUR 7,728,416.08, representing a 3% increase or EUR 242,732.98 more compared to 2023, when they amounted to EUR 7,485,683.10. This growth was primarily due to a 5% increase in accommodation revenues at the "Park Soline" campsite, driven by higher income from lump-sum fees, mobile homes, and other services.

Real-estate sector revenue, specifically from the City Galleria business and shopping centre, amounted to EUR 2,159,072.06, representing an increase of 5% or EUR 103,021.20 compared to 2023, when revenue amounted to EUR 2,056,050.86. This increase was driven by higher revenue from commercial space leases, common costs, and parking garage revenue.

Revenues from other sectors, including DMC Ilirija Travel and other profit centres, reached EUR 1,549,293.18, reflecting an increase of EUR 448,273.91 compared to the previous year, when they amounted to EUR 1,101,026.27. This growth was primarily due to a significant 43% increase in revenues generated by DMK Ilirija Travel, driven by growth in physical indicators (number of events and participants), as well as the organization of higher-value events.

TOTAL: Operating revenue per activity amounted to EUR 30,351,531.83, representing an increase of 8% compared to 2023, when it amounted to EUR 28,047,808.67.

FINANCIAL OPERATIONS Reporting system according to the USALI standards 01/01/2024 – 31/12/2024 ILIRIJA d.d. total (after allocation – reallocation of the common revenue and common costs)

Items	Annual cumulative achievements in 2022	Annual cumulative achievements in 2023	Annual cumulative achievements in 2024	Index 2024/2023
TOTAL NET REVENUE (operating)	22.395.858,89	26.534.593,86	28.636.566,95	107,92
Total direct costs	1.500.697,46	1.747.002,66	1.937.593,21	110,91
Total salary and labor costs	4.319.332,16	5.340.398,02	5.834.050,88	109,24
Total other department costs	1.390.073,23	1.637.228,53	1.761.682,39	107,60
TOTAL CONTRIBUTION	15.185.756,03	17.809.964,65	19.013.240,47	106,76
Total costs to GOP	14.878.592,68	18.343.804,34	19.699.226,13	107,39
GOP	7.517.266,21	8.190.789,52	8.937.340,82	109,11
Grandtotal net revenues	23.778.484,20	28.286.740,07	30.685.992,57	108,48
Grandtotal costs	19.919.286,81	24.216.322,49	26.251.948,61	108,41
PROFIT BEFORE TAXATION	3.859.197,39	4.070.417,58	4.434.043,96	108,93
Corporate income tax	741.443,62	790.887,36	857.969,63	108,48
NET PROFIT	3.117.753,76	3.279.530,22	3.576.074,33	109,04
EBITDA	7.277.922,67	7.795.816,56	8.120.672,86	104,17
EBIT	4.314.022,87	4.556.531,43	4.896.264,66	107,46

CUMULATIVE COMPARATIVE OVERVIEW

of fundamental operating results, as well as asset, capital and liability indicators of the Company as on 31/12/2024, and for the 2014 - 2023 period

YEAR	TOTAL LIABILITIES	CAPITAL	VALUE OF ASSETS	NET DEBT	REVENUES	OPERATING PROFIT	EBITDA	PROFIT BEFORE TAX	NET PROFIT	ANNUAL DIVIDEND
1	2	3	4	5	6	7	8	9	10	11
31/12/2024	16.862.887,68	54.693.348,46	71.556.236,14	539.116,87	30.685.992,57	7.786.212,12	8.120.672,86	4.434.043,96	3.576.074,33	1.685.911,50
31/12/2023	18.445.923,49	53.114.266,63	71.560.190,12	3.195.369,06	28.286.740,07	7.556.885,16	7.795.816,56	4.070.417,58	3.279.530,22	1.323.708,10
31/12/2022	19.048.576,06	51.066.316,12	70.114.892,18	5.575.375,89	23.778.484,20	7.230.778,62	7.277.922,67	3.859.197,39	3.117.753,76	1.117.498,51
31/12/2021	16.544.966,56	49.139.955,35	65.684.921,91	7.934.616,50	17.895.165,96	6.427.688,79	6.475.518,77	3.498.505,01	2.942.793,29	0,00
31/12/2020	17.067.825,35	46.197.162,06	63.264.987,41	12.150.023,98	12.972.030,50	2.813.417,71	2.826.319,08	135.626,72	135.626,72	0,00
31/12/2019	18.381.407,73	46.026.063,36	64.407.471,09	13.447.107,96	22.270.562,99	6.665.952,18	6.677.318,23	4.158.725,02	4.158.725,02	1.117.255,56
31/12/2018	18.317.937,20	43.052.015,80	61.369.953,01	14.714.843,61	21.374.859,65	6.988.849,85	7.195.733,52	4.915.411,40	4.915.411,40	958.423,25
31/12/2017	17.498.318,16	39.049.198,30	56.547.516,46	14.887.261,26	19.971.687,23	6.455.124,95	6.582.689,11	4.497.416,49	3.683.772,56	798.532,09
31/12/2016	18.249.686,18	36.589.542,50	54.839.228,69	15.164.970,71	17.123.764,99	5.786.616,54	5.976.127,08	4.146.366,29	4.071.411,04	655.272,15
31/12/2015	12.835.159,60	29.245.909,73	42.081.069,34	8.397.336,65	17.007.961,86	4.948.296,21	5.012.569,79	3.385.830,45	2.857.969,41	496.488,15
31/12/2014	17.659.249,67	23.605.908,24	41.265.157,91	13.575.242,08	16.308.149,46	4.373.925,04	4.407.875,41	2.705.569,73	2.454.469,98	496.488,15

Key financial performance indicators

In the 2024 business year, the Company achieved the best operating results so far, including in the field of generated financial indicators, with which it continuously ensures further stability, resilience and sustainability of its operations, despite the disturbed macroeconomic environment.

Indicator	2023	2024	Index 2024/2024
Financial stability, liquidity and indebtedness
Self-financing rate	74,22%	76,43%	1,030	Share of equity capital in total fund sources (i.e. in total liabilities & stockholders' equity).
The degree of indebtedness	25,78%	23,57%	0,914	Share of debt in total fund sources (i.e. in total liabilities & stockholders' equity).
Financial stability coefficient	0,90	0,88	0,975	Fixed assets to long-term sources ratio (shareholders' capital and reserves increased by long-term liabilities).
Accelerated liquidity coefficient	2,00	2,16	1,079	Ratio of current assets reduced by the stocks and short-term liabilities.
Current liquidity coefficient	2,03	2,20	1,083	Current assets to short-term liabilities ratio.
Activity indicators
Ratio of total assets turnover	0,40	0,43	1,085	Total revenue to total assets ratio shows how many times in a year the disposable assets are used to generate total revenues.
Short-term assets turnover ratio	2,16	2,08	0,961	Total revenue to current assets ratio shows how many times a year the disposable current assets are used to generate total revenues.
Business performance indicators
Cost effectiveness	1,17	1,17	1,001	Total revenue and total expenses ratio.
Profitability	11,59%	11,65%	1,005	Net profit/loss and total revenue ratio.
Return on assets	4,58%	5,00%	1,090	Annual rate of return on invested assets indicates the profit/loss and total asset ratio.
Share of EBITDA in total revenue	27,56%	26,46%	0,960	Earnings before interests, taxes, depreciation and amortization to total revenue ratio.
Share of EBIT in total revenue	16,11%	15,96%	0,991	Earnings before interests and taxes to total revenue ratio.

Composition and indicators of resources and sources of financing in the balance sheet as at 31/12/2024 and the presence of operating revenue in the sources of financing as at 31/12/2024

Indicator	2023	2024	Index 2024/2023
Share of fixed assets in the assets	81,73	79,38	97,12
Share of current assets in the assets	18,27	20,62	112,87
Share of capital in reserves and in liabilities	74,22 76,43		102,98
Share of long-term commitments in the liabilities	16,79	14,19	84,56
Share of short-term commitments in the liabilities	8,99 9,37		104,23
Share of operating revenue in sources of financing
Share of operating revenue in equity and reserves	52,81	55,49	105,09
Share of operating revenue in long-term commitments	233,50	298,83	127,98
Share of operating revenue in total commitments	152,05	179,99	118,37
Share of operating revenue in liabilities	39,19	42,42	108,22

Directly generated and distributed economic value for the year 2024 and copmarison with the 2022 and 2023

Description	2022	2023	2024	Index 2024/2023
Directly generated economic value	23.778.484,20	28.286.740,07	30.685.992,57	108,48
Revenues from sales	23.731.340,15	28.047.808,67	30.351.531,83	108,21
Other revenues	47.144,05	238.931,40	334.460,74	139,98
Distributed economic value	18.105.137,65	22.533.845,61	25.005.544,23	110,97
Operating costs	9.782.238,71	12.064.764,37	13.404.869,71	111,11
Employee salaries and benefits	6.634.294,72	8.321.519,10	9.091.817,73	109,26
Payment to capital providers	1.117.498,51	1.323.708,10	1.685.911,50	127,36
Payments to the government*	487.077,61	719.214,00	754.312,92	104,88
Investments in the community	84.028,10	104.640,04	68.632,37	65,59
Retained economic value	5.673.346,54	5.752.894,46	5.680.448,34	98,74

*Payments to the state include payroll taxes and real estate taxes.

Contribution to the state through taxes and public levies

Based on the economic success of its business, Ilirija d.d. significantly contributes to the state through taxes and public levies. In 2024, the Company paid a total of EUR 6.884.468,80 in taxes and public levies:

Capital market realisation

EUR	2024	2023	% of change
Total turnover	490,355.00 €	479,167.00 €	2.33%
Average share price	27.66 €	24.83 €	11.40%
Average turnover per transaction	3,771.96 €	7,371.80 €	-48.83%
Average daily turnover	6,368.25 €	16,523.00 €	-61.46%
Last share price	30.00 €	25.80 €	16.28%
Market capitalization*	72,404,640.00 €	62,267,990.40 €	16.28%
Market capitalization**	66,757,078.08 €	59,926,907.04 €	11.40%
Number of shares:	2,413,488	2,413,488

*indicated by the methodology of calculation according to the last share price multiplied with number of shares

**Indicated by the methodology of calculation according to the average share price multiplied with number of shares

In the business year 2024, the Company's share designated as ILRA was traded in the amount of EUR 490,355.00, constituting an increase by 2.33% compared to 2023, when trading amounted to EUR 479,167.00. Average turnover per transaction amounts to EUR 3,771.96, with average daily turnover amounting to EUR 6,368.25.

A total of 17,730 shares were traded at an average realised share price of EUR 27.66, representing an increase of 11.40% compared to the average share price for 2023, which amounted to EUR 24.83. Compared to the price at the beginning of the business year, when it amounted to EUR 25.00, at the end of the year it increased by 20%, i.e. to the amount of EUR 30.00. Also, the last share price was EUR 30.00, representing an increase of 16.28% compared to the last share price in 2023, which amounted to EUR 25.80. In proportion to the increase in the last share price, the market capitalization of the Company also increased, which, expressed by the last share price in the observed period, amounted to EUR 72,404,640.00, compared to EUR 62,267,990.40 in the previous year, recoding an increase of EUR 10,136,649.60.

4.3 Publications Under the Taxonomy Regulation

Ilirija d.d. classified all of its activities in accordance with the criteria set out in the last version of the European Taxonomy Regulation (Delegated Regulation (EU) 2021/2139 of the Commission of 4 July 2021), while the disclosure of key indicators and their specification is displayed in accordance with Delegated Regulation (EU) 2021/2178 of the Commission of 6 July 2021 and subsequent amendments to the Delegated Regulation. Based on the aforementioned legislative framework, Ilirija d.d. is disclosing key performance indicators, i.e. revenue, capital expenditure and operating expenditure of taxonomically acceptable activities (the real-estate, hotel, camping sectors and the destination management company), the Company generates the largest part of its income in the accommodation industry, which as of 2023 is among the taxonomically acceptable activities.

In order to calculate the above-mentioned indicators, the numerator and denominator were determined by recording, controlling and monitoring accounting and financial indicators for 2024, under the same accounting criteria implemented by the Ilirija d.d. Accounting and Finance Department.

Share of revenue from products and services related to the taxonomy-compliant economic activities

The key indicator relating to the revenue is calculated as a ratio of net revenue generated from taxonomically acceptable activities (the numerator) to the total revenue (the denominator). This revenue corresponds to the revenue approved in accordance with the International Accounting Standard (IAS) 1, paragraph 82(a), adopted by Commission Regulation (EC) No 1126/2008. The name of this key indicator is shown in Note 19 "Segment Information" of the 2024 Annual Report.

		Substational contribution criteria DNSH criteria ("Does Not Significantly Harm")										Minimum Safeguards	Proportion of Taxonomy - aligned (A.1) or -eligible (A.2) revenue, year 2023	Category enabling activity	Category transitional activity
Economic Activities					Climate Change Mitigation	Climate Change Adaptation	Water	Pollution	Circular Economy	Biodiversity	Climate Change Mitigation	Climate Change Adaptation	Water	Pollution	Circular Economy	Biodiversity
		Code	Revenue	Proportion of revenue, 2024
			in €	%	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y/N	Y/N	Y/N	Y/N	Y/N	Y/N	Y/N	(%)	E	T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
/			0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	0%	/	/
Revenue of environ mentally sustainable activities (Taxo nomy-aligned) A.1			0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	0%	/	/
Of which enabling			0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	0%	/	/
Of which transitional			0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	100%	/	/
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
REVENUE					EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)
Acquisition and owner ship of buildings		CCM 7.7	2.159.072,06 €	7,04%	EL	EL	N/EL	N/EL	N/EL	N/EL								7,27%
Hotels, holiday, camping grounds and similar accommodation		BIO 2.1	19.409.516,08 €	63,25%	N/EL	N/EL	N/EL	N/EL	N/EL	EL								63,10%
A. Revenue of Taxonomy-eligible activities (A 1. + A.2)			21.568.588,14 €	70,29%														70,37%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Revenue of taxo nomy-non-eligi ble activities			9.117.404,43 €	29,71%
TOTAL			30.685.992,57 €	100%

Share of capital expenditure for products or services related to the taxonomy-compliant economic activities

This indicator is defined as the ratio of acceptable and unacceptable taxonomy CapExes (the numerator) and the total CapEx (the denominator).

In order to calculate the CapEx numerator, first the activities which meet acceptable taxonomic criteria need to me identified. Taxonomically acceptable activities are "Acquisition and ownership of buildings" and "Hotels, holiday, camping grounds and similar accommodation".

All investments in the amount of EUR 1,394,118.34 that refer to investments in the hotel and camping sectors, the destination management company and other facilities are included for the taxonomically acceptable activity "Hotels, holiday, camping grounds and similar accommodation", and are shown in note 7 "Property, Plant and Equipment" of the 2024 Annual Report. Furthermore, for the taxonomically acceptable activity "Purchase and ownership of buildings", capital investments amount to EUR 83,264.40 and refer to investments in the "City Galleria" Business and Shopping Centre, and are shown in Note 8 "Investment property" of the 2024 Annual Report.

In 2024, the total CapEx includes all investments in tangible and intangible assets in all Company sectors and amounts to EUR 1,593,127.52.

CAPEX

	Substational contribution criteria DNSH criteria ("Does Not Significantly Harm")												Minimum Safeguards	Proportion of Taxonomy - aligned (A.1) or -eligible (A.2) CapEx, year 2023	Category enabling activity	Category transitional activity
Economic Activities	Code	CapEx in €	Proportion of CapEx, 2024 %	Climate Change Mitigation	Climate Change Adaptation	Water	Pollution	Circular Economy	Biodiversity	Climate Change Mitigation	Climate Change Adaptation	Water	Pollution	Circular Economy	Biodiversity
				Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y/N	Y/N	Y/N	Y/N	Y/N	Y/N	Y/N	(%)	E	T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
/		0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	0%	/	/
CapEx of environmentally sustainable activities (Taxonomy-aligned) A.1		0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	0%	/	/
Of which enabling		0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	0%	/	/
Of which transitional		0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	100%	/	/
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
				EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)
Acquisition and owner ship of buildings	CCM 7.7	83.264,40 €	5,22%	EL	EL	N/EL	N/EL	N/EL	N/EL								1,95%
Hotels, holiday, cam ping grounds and similar accommodation	BIO 2.1	1.394.118,34 €	87,51%	N/EL	N/EL	N/EL	N/EL	N/EL	EL								81,82%
A. CapEx of Taxo nomy-eligible acti vities (A 1. + A.2)		1.477.382,74 €	92,73%														83,77%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES

TOTAL	1.593.127,52 €	100%
CapEx of taxo nomy-non-eligi ble activities	115.744,78 €	7,27%

Share of operating expenditure for products or services related to the taxonomy-compliant economic activities

This indicator is defined as the ratio of acceptable and unacceptable taxonomy OpExes (the numerator) and the total OpExes (the denominator).

The numerator of the OpEx consists of the operating expenditure of taxonomically acceptable activities in the total of EUR 11,371,938.47, or 82.40% of the Company's total operating expenditure.

The numerator of the OpEx consists of the operating expenditure of taxonomically unacceptable activities in the total of EUR 2,429,496.51, or 17.60% in comparison to the Company's total operating expenditure.

The total OpEx is the sum of all operating expenditure in accordance with IFRS standards, as indicated in the 2024 Annual report in Notes 21, 22 and 24. The above is calculated by the sum of the Company's total operating expenditure reduced by the salaries and salary expenditure and Note 23 from the financial report.

The OpEx numerator represents the total OpEx, i.e. all operating expenditure (raw material, material and energy expenses, service expenses and other operating expenditure).

OPEX

							Substational contribution criteria			DNSH criteria ("Does Not Significantly Harm")						Minimum Safeguards	Proportion of Taxonomy - aligned (A.1) or -eligible (A.2) OpEx, year 2023	Category enabling activity	Category transitional activity
Economic Activities		OpEx in €	Proportion of OpEx, 2024 %	Climate Change Mitigation	Climate Change Adaptation	Water	Pollution	Circular Economy	Biodiversity	Climate Change Mitigation	Climate Change Adaptation	Water	Pollution	Circular Economy	Biodiversity
	Code			Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y;N;N/EL (b) (c)	Y/N	Y/N	Y/N	Y/N	Y/N	Y/N	Y/N	(%)	E	T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
/		0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	0%	/	/
OpEx of environmentally sustainable activities (Taxonomy-aligned) A.1		0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	0%	/	/
Of which enabling		0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	0%	/	/
Of which transitional		0,00	0%	/	/	/	/	/	/	/	/	/	/	/	/	/	100%	/	/
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
				EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)	EL; N/EL (f)
Acquisition and owner ship of buildings	CCM 7.7	686.118,31 €	4,97%	EL	EL	N/EL	N/EL	N/EL	N/EL								5,26%
Hotels, holiday, cam ping grounds and similar accommodation	BIO 2.1	10.685.820,16 €	77,43%	N/EL	N/EL	N/EL	N/EL	N/EL	EL								76,76%
A. Revenue of OpEx-eligi ble activities (A 1. + A.2)		11.371.938,47 €	82,40%														82,02%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES

TOTAL	13.801.434,98 €	100%
OpEx of taxo nomy-non-eligi ble activities	2.429.496,51 €	17,60%

5 CORPORATE ENVIRONMENTAL RESPONSIBILITY

122

5.1 Environmental Management

The Company bases its business policy on management in line with the principles of sustainable and responsible development, with particular focus on environmental protection, as the environment is the fundamental resource of the tourism industry and the foundation of sustainable and responsible tourism development. Environmental protection represents a significant segment of the Company's integrated management systems and is a part of its strategic decisions and business processes.

As the leading tourist company in Biograd na Moru and its surroundings, Ilirija d.d. is aware of the impact of its business activities and operations on the environment, which is why it is committed, in the long term, to protecting and preserving the environment as the basic resource for tourist activities, as well as to preventing pollution, i.e. minimising it, in all of its business processes and activities. This is why environmental issues are of a major significance for the company given their possible impacts on the economic, environmental and social aspects of its business.

The Head of Environmental Protection and Horticulture has been appointed within the company, and they answer to the Management Board. At the annual level, the Head of Environmental Protection prepares plans and activities with defined goals at the level of the entire business system, but also of each individual sector, taking into account their specific nature and the operational nature of the business activity.

Environmental protection goals and activities in 2024:

• systematic approach to environmental protection while adhering to the legal regulations and sustainable development principles,

• fulfilment of prescribed obligations towards the competent state administration bodies,

• anticipation, monitoring, prevention, limitation and elimination of possible adverse environmental impacts through defined business risks,

• management of environmental impacts (soil, air, water) caused by waste production, harmful substances, emissions of polluting gases, radiation, noise, etc.

• encouraging the use of products and operating procedures that are less harmful to the environment,

• proper resource and energy management,

• encouraging the use of renewable natural sources and energy,

• adoption of plans and measures through documents on environmental protection and sustainable development within the standard ISO 14001: 2015, and

• conducting training on environmental protection and sustainability.

5.2 Education and Activities

In 2024, two internal workshops were held on the topic of environmental protection and more responsible waste management. Employees from the sector participated in the workshops to once again increase the awareness and practical knowledge of employees, which later has a direct effect on the reduction of the amount of mixed municipal waste, waste from the catering industry and better separation of recyclables generated in processes.

In addition to the topic of waste, the importance of rational use of water and reducing the use of harmful chemicals in households and the kitchen was emphasized, thereby protecting nature, reducing the impact on health, contributing to sustainability and reducing costs.

5.3 Investment in the environment

In 2024, environmental protection investments were focused on waste equipment, maintaining international environmental standards and employees education.

	2022	2023	2024
Total	97.425,09	58.188,89	42.813,03

Investment in the environment (€)

5.4 Energy

Energy is a material topic due to its effect on economic, environmental and social impacts of the Company. On-site maintenance services also take care of installed, large and small energy/resource consumers. Internal preventive inspections are regularly carried out, as well as external inspections by maintenance service providers. When choosing new devices, i.e. electrical consumers attention is paid to their energy efficiency class, all for the purpose of improved energy efficiency. Among other things, activities on a smaller scale are systematically and continuously carried out, such as the gradual replacement of existing luminaires with LED bulbs.

In 2024, the Company used the following energy sources

Energy management:

• daily and monthly control at the level of each facility and the entire Company
• setting annual goals for optimal energy use
• strategic commitment of the company to the transition to environmentally acceptable energy sources
• use of energy from renewable sources
• energy efficiency when purchasing new devices, and
• continuous education of employees and guests.

Total energy consumption within the organisation, expressed in GJ

25,000.00

Energy source (GJ)	2022	2023	2024
Electricity	21,451.73	21,489.60	22,569.40
Gas – LPG	1,265.62	1,169.74	1,233.30
Fuel oil	1,796.15	2,186.36	2,434.60
Natural gas	4,002.16	4,395.40	4,473.80
Total	28,515.66	29,241.10	30,711.10

Energy source consumption (GJ)

Total energy consumption at the Company level increased slightly compared to the previous year, mostly as a result of the increase in the volume of business activities at the level of all company sectors, especially its tourism sectors.

Electricity consumption by sectors expressed in GJ

Year	2022	2023	2024
Hotel sector	7,643.00	8,041.54	8,147.16
Camping sector	3,220.90	3,166.40	3,496.87
Nautical sector	2,756.50	2,655.03	2,829.97
Other	7,831.30	7,626.61	8,095.49
Total	21,451.70	21,489.58	22,569.49

Energy intensity

Energy intensity shows the ratio of consumed electricity to the total number of overnight stays in the hotel and camping sectors, as well as the total number of berths in the nautical sector.

	2022			2023			2024
Total electricity consumption by sector	GJ	Number of overnigt stays	Energy intensity	GJ	Number of overnigt stays	Energy intensity	GJ	Number of overnigt stays	Energy intensity
Hotel sector	7,643.00	100,551.00	0.08	8,041.54	118,680.00	0.07	8,147.16	126,130.00	0.06
Camping sector	3,220.90	312,057.00	0.01	3,166.40	329,010.00	0.01	3,496.87	321,016.00	0.01
Total (hotel and camping sectors)	10,863.90	412,608.00	0.03	11,207.94	447,690.00	0.04	11,644.03	447,146.00	0.03

	2022			2023			2024
Total electricity consumption by sector	GJ	Number of berths	Energy intensity	GJ	Number of berths	Energy intensity	GJ	Number of berths	Energy intensity
Nautical sector	2,756.50	805	3.42	2,655.03	805	3.30	2,829.97	805	3.52

Total natural gas consumption by sector

Year	2022	2023	2024
Hotel sector	4.002,16	4.395,40	4.473,80
Camping sector	0	0	0
Nautical sector	0	0	0
Other	0	0	0
Total	4.002,16	4.395,40	4.473,80

Ratio of natural gas consumed per night in the hotel sector

	2022			2023			2024
Total natural gas con sumption by sector	GJ	Number of overnigt stays	Energy intensity	GJ	Number of overnigt stays	Energy intensity	GJ	Number of overnigt stays	Energy intensity
Hotel sector	4.002,16	100.551,00	0,04	4.395,40	118.680,00	0,03	4.473,80	126.130,00	0,04

Gas (LPG) consumption by sector

Year	2022	2023	2024
Total gas (LPG) con sumption by sector (GJ)
Hotel sector	126,45	43,56	104,45
Camping sector	992,02	968,15	968,72
Nautical sector	137,25	149,06	147,94
Other	9,90	8,97	12,19
Total	1.265,62	1.169,74	1.233,30

Ratio of LPG consumed per night in the hotel sector and camping

	2022			2023			2024
Total LPG consumption by sector	GJ	Number of overnight stays	Energy intensity	GJ	Number of overnight stays	Energy intensity	GJ	Number of overnight stays	Energy intensity
Hotel sector	126,45	100.551,00	0,001	43,56	118.680,00	0,0004	104,45	126.130,00	0,00083
Camping sector	992,02	312.057,00	0,003	968,15	329.010,00	0,003	968,75	321.016,00	0,003
Total (hotel and camping sectors)	1.118,47	412.608,00	0,003	1.011,71	447.690,00	0,002	1.073,20	447.146,00	0,002

Gas consumption ratio (LPG) per berth in nautical sector

	2022			2023			2024
Total LPG con sumption by sector	GJ	Number of berths	Energy intensity	GJ	Number of berths	Energy intensity	GJ	Number of berths	Energy intensity
Nautical sector	137,25	805	0,17	149,06	805	0,2	147,94	805	0,18

Energy consumption outside the organisation

Energy consumption outside the organization refers to fuel consumption (petrol, diesel, euro blue diesel) expressed in litres for the fuel used by company vehicles, working machines and vessels, as well as the fuel used by passenger cars for company purposes.

	2022	2023	2024
Passenger cars	46.529,00	49.292,00	55.969,00
Work vehicles and machines	39.808,00	41.462,00	38.642,00
Boat "Nada"	27.062,00	19.719,00	22.282,00
Other vessels	7.523,00	4.002,00	4.170,00
Total	120.922,00	114.475,00	121.063,00

Fuel consumption ratio in 2024

5.5 Water

All of Company facilities are supplied with drinking water from the local water supply, which also shows that it acts on a local and regional level, while the irrigation of horticultural and green areas of the camp has been carried out applying the drip irrigation method ever since 2013, using our own well at a depth of 60 metres, which has been legalised and has a valid water rights permit, i.e. a permit which defines the quantity of water to be pumped on an annual basis. The campsite's own water source allows it to have a high level of horticultural landscaping with the maximum possible preservation of the natural resources. Through the operational activities of its departments, the Company is able to dedicate itself to reducing the use of drinking water as one of the most important resources which has a significant impact on the environmental and economic performance. Maintenance services perform preventive controls of internal water supply installations and actively participate in the activities aimed at reducing the consumption of drinking water. Therefore, in order to reduce drinking water consumption at the "Park Soline" campsite and in all shared sanitary facilities and hotel accommodation units, the maintenance service installed over 500 water-saving aerators on taps and showers.

Water management approach:

• daily and monthly control at the level of each facility and the entire company,
• use of water from the wellbore for the irrigation of horticultural areas in the camp,
• controlled waste water discharge,
• regular technical maintenance and inspection of water supply installations, and
• education of employees and guests with the help of informational materials/signs on sustainable water use.

Overview of water consumption by sector

Total water consumption (m3)	2022	2023	2024
Hotel sector	72.159,00	78.838,00	69.595,00
Camping sector	52.390,00	54.401,00	67.862,00
Nautical sector	37.343,00	25.046,00	26.563,00
Other	16.753,00	17.725,00	19.169,00
Total	178.645,00	176.010,00	183.189,00

Water consumption (m3) by number of overnight stays in hotel and camping sectors

Total amount of groundwater (m3)	2022	2023	2024
abstracted from the S-1 well bore in the Park Soline camp	3782	3857	10672

The share of delivered quantities of water to Ilirija d.d. in relation to other consumers in 2024

Ilirija d.d.

Ostali potrošači na području općina Pakoštane, Sv. Filip i Jakov, Pašman, Tkon i Biograda na Moru Other users of the local waterworks (the city of Biograd na Moru and the municipalities of Pakoštane, Sveti Filip i Jakov, Pašman, Tkon)

5.6 Effluents and Waste

Waste waters

Before they are released into the city's sewage, all waste waters from our facilities are submitted to a certain type of pre-processing, i.e. purification. This is as far as the impact of the company's waste waters on the environment goes. Industrial waste waters generated at the ship-cleaning facility in the Marina Kornati go through a physical-chemical purifier prior to being discharged. This purifier is regularly maintained, and the quality of discharged water is checked through an approved laboratory in accordance with the water rights permit. When the purifier is in use, the maintenance service monitors its operation and the consumption of water pretreatment agents on a daily basis, and also checks this outlet upon request. So far, and thus also in the reporting period, there have been no reports or complaints about any accidental discharge or about the discharging of waste waters of unacceptable composition or quality into the sea. In fact, the Marina Kornati has been proudly displaying the internationally recognized Blue Flag.

Catering capacities in our hotels, camp and marina have mechanical and physical separators of edible oils and fats installed, and they are regularly inspected by internal maintenance services and authorized external companies before being discharged into the public sewage system. Moreover, parking areas of our facilities are also equipped with separators. Authorised companies are in charge of their cleaning as well as disposing of oily water and residue. The discharged waste waters are not recycled or returned in any way to the system for reuse.

The destination of all waste waters produced at the Company's facilities is the public drainage system, except for the waters generated at the ship-cleaning facility at the Marina Kornati. Despite its size and requirements, the Park Soline campsite is one of the rare camps in Croatia to discharge all its waste waters into the public drainage system, which goes to the city's final treatment plant.

Waste

Amounts of produced waste by types

Types of waste	2022	2023	2024
Hazardous waste (t/year)	47,34	40,96	33,79
Non-hazardous waste (t/year)	46,083	126,748	128,34
Mixed municipal waste (t/year)	505,31	277,83	175,50
Total (t/year)	598,73	445,54	337,63

In 2024, less waste was produced compared to the previous year due to a reduction in mixed municipal waste due to better sorting and a reduction in the amount of hazardous waste.

Waste
Hazardous	Amount in (t)
Waste printing toners containing hazardous substan ces	0,23
Electronic waste	1,22
Fluorescent tubes and other mercury-containing waste	0,17
Other engine, machine and lubricating oils	0,07
Sludges from oil/water separators	3,41
Oily water from oil/ water separators	18,50
Packaging material that contains residues of or is con taminated by hazardous substances	5,15
Absorbents, filter materials, wiping cloths and prote ctive clothing contaminated by hazardous substances	1,62
Oil filters	3,31
Pressurized packaging	0,11
Infectious medical waste	0,01
TOTAL	33,79

Types of hazardous waste in 2024 (amounts in tonnes): Types of non-hazardous waste in 2024 (amounts in tonnes):

Waste	Amount in (t)
Non-hazardous
Paper/cardboard	30,29
Plastic (plastic packaging)	19,69
Metal (metal packaging)	2,12
Glass (glass packaging)	20,51
Mixtures of fats and oils from oil/water separators, con taining only edible oils and fat	13,20
Edible oils and fats	5,75
Bulky waste	17,32
Biodegradable waste	19,46
TOTAL	128,34

Compliance with legal requirements

Own Environmental Quality and Protection Policy

Implementation of national and international standards related to environment protection

5.7 Compliance with environmental protection regulations

By following and adhering to environmental legislation and to our internal Environmental and Quality Policy, the Company reaffirms its fundamental commitment and aspiration to make sustainable progress.

Regular inspections confirm the Company's compliance with legal regulations, while internal and outsourced audits of its international eco-labels or standards serve as tools to improve our environmental focus and enable it to grow and address all processes with an effect on the environment in a more comprehensive way. Company employees systematically keep track of changes in legislation and update them accordingly

5.8 Horticultural and Spatial Design

The Company pays special attention to horticultural design and landscaping in all facilities in which it does business, with a special emphasis on the camping sector and the "Park Soline" camp. Since 2004, works on cleaning and thinning the existing, impassable and neglected parts of the camp were initiated in the "Park Soline" campsite. Garrigue prevailed, consisting of: Aleppo pine (Pinus halepensis) at a ratio of 60%, evergreen oak (Quercus ilex) at a ratio of 30%, and oak (Quercus) at a ratio of 10%, with the low understorey composed primarily of the following species: terebinth, green olive tree, rockrose, Euphorbia spinosa L., laurustinus, etc. The works were continuously monitored by Hrvatske šume d.o.o., and everything was performed in agreement with them, especially in the professional segment of forest conservation. Horticultural works have been performed in order to rehabilitate, i.e. restore and protect the vegetation cover to the greatest possible extent. In order to further improve the existing plantings and the structural composition of dendrological plants in the "Park Soline" campsite, a completely new planting material was planted. We enrich the campsite with Mediterranean plants with the aim of preserving the existing landscape. This includes trees planted in every free space, various species of Mediterranean bushes, smaller perennial plants, climbing plants, ground covering plants, hedges (green fences) etc. The area is dominated by oleander (Nerium oleander), pittosporum (Pittosporum tobira), laurel (Laurus nobilis), trumpet vine (Campsis radicans), rosemary (Rosmarinus officinalis), European nettle tree (Celtis australis), lime trees (Tilia), mimosas (Acacia dealbata), cypresses (Cupressus sempervirens), black locust trees (Robinia pseudoacacia), magnolias (Magnolia grandiflora), and many other species.

This approach to landscaping, improving and creating a campsite-park, with a lot of effort invested and a desire to develop it to the level of a unique arboretum, is unique among Croatian camps. From 2004 onward, exceptional attention has been paid to the rehabilitation, or sanitary pruning, of trees throughout the camp, which was carried out by companies trained and equipped to work on thousands of existing trees. In 2024, the aim was still to supplement the existing plantations with new species that contribute to the design and mission of one day making the camp a unique park environment with special locations that will impress all visitors. Due to the extremely demanding maintenance of the campsite, biocidal products are used, but to the smallest possible extent, and water for irrigation is used rationally.

Total number of planted seed lings by sectors of Ilirija d.d.	2022	2023	2024
Hotel sector	7676	6349	6335
Camping sector	1289	2596
Nautical sector	1584	625	896
Total	10549	9570	8144

at the level of a campsitepark

Preservation of biodiversity by enriching the area with Mediterranean plants

6.1 Employment

Employment is a material topic for the Company, given the fact that employees, especially in the tourism industry, are the performers of the business process which, on the one hand, actively participate in the development of products and services, and on the other hand, contribute to the achievement of planned business results and the quality of services provided. The limits of influence within the Company extend to all employees within all sectors and services or profit centres, while outside the Company, the limits of influence are limited to the local or regional level of the area of operation. The local level refers to the town of Biograd na Moru, as well as to surrounding towns and municipalities, while the regional level covers the area of the Zadar County.

A notable labour shortage on the Croatian labour market poses a specific challenge for hospitality and tourism, taking into account the seasonal nature of Croatian tourism, as well as the fact that it is an extremely labour-intensive industry. Its deficit could affect the success of the peak tourist season. Therefore, ensuring optimum personnel structure for the smooth operation of business processes and the quality of service in the peak season as well as the preservation of the achieved financial standing deriving from employment, is one of the main objectives of the Company in terms of HR management in the reporting period. In 2024, in the segment of human resources management, the Company undertook a series of activities ensuring the optimal number of employees for the business year with a special focus on the main season: employment of qualified and professional employees, timely employment of seasonal employees, maintaining a high rate of returning seasonal employees and actively taking care of improving their material rights, which is one of the main objectives of the Company in terms of HR policy.

At Company level, the Management Board, the Human Resources and Payroll Service and sector managers coordinate the plan of necessary personnel at the operational level, i.e. they plan the optimal number of full-time and seasonal employees by profit centres, by sectors and at the level of the entire system for the next financial year. In addition to the planned number of employees being defined on a daily, weekly and monthly basis, their jobs are defined as well, and so is the beginning and end of their employment, which is ultimately confirmed and approved by the Management Board. In coordination with sector managers, the HR department carries out the staff selection and placement process.

The fundamental principles of the Company in human resources management and employment are as follows:

• preservation of working-age, highly qualified and professional employees at all levels;
• continuous education of employees at all levels;
• continuous care for the financial situation of employees;
• retention of a high proportion of domestic (local) employees;
• care for the life and health of employees.

Overview of employees by month for 2024

NUMBER	PROFIT CENTER / ORGANIZATIONAL UNIT	NUMBER OF EMPLOYEES 2024
		01/01	29/02	31/03	30/04	31/05	30/06	31/07	31/08	30/09	31/10	30/11	31/12
	*PROFIT CENTER
1	HOTEL ADRIATIC	22	10	4	21	35	43	43	38	33	17	11	35
2	HOTEL ILIRIJA	41	45	55	43	50	49	54	51	52	46	53	54
3	HOTEL KORNATI	30	13	3	26	37	37	40	36	40	26	11	32
4	HOTEL VILLA DONAT	1	1	1	1	7	24	31	31	18	1	1	0
5	LAVENDER BAR	0	0	2	3	4	4	9	9	2	2	0	0
6	MARINA KORNATI	56	57	54	51	56	56	58	56	54	63	57	52
7	RESTAURANT "MARINA KORNATI"	10	17	13	12	13	14	15	15	16	19	19	12
8	BEACH CLUB ILIRIJA	1	1	1	2	2	14	19	15	2	1	1	0
9	TOURIST AGENCY	3	3	3	3	3	6	7	9	5	4	3	3
10	CAMPSITE "PARK SOLINE"	24	25	29	28	30	56	57	53	31	16	22	17
11	RESTAURANT "PARK SOLINE"	0	0	5	11	20	23	27	23	16	10	0	0
12	ARSENAL	4	6	15	8	5	1	0	0	3	9	12	3
13	TENNIS CENTER "ILIRIJA"	3	3	3	4	3	4	3	3	3	3	3	3
14	BEACH BAR DONAT	0	0	0	0	0	0	0	0	0	0	0	0
	*ORGANIZATIONAL UNITS
15	COMMON SERVICES	40	40	41	43	42	41	40	41	41	41	40	40
16	MAINTENANCE SERVICE	7	8	8	8	8	8	9	8	9	11	9	9
17	LAUNDRY	6	6	7	9	12	13	13	14	14	12	7	7
18	HORTICULTURE	14	28	17	14	13	15	15	21	14	13	13	13
19	EVENT SHIP "NADA"	2	2	2	2	2	2	2	2	2	2	2	2
20	WELLNESSS	6	6	6	6	6	8	8	8	6	6	6	6
21	NAUTICAL FAIR	2	2	2	2	2	2	2	2	2	2	2	2
22	CITY GALLERIA	19	18	18	18	16	17	17	17	17	17	16	16
	TOTAL	291	291	289	315	366	437	469	452	380	321	288	306

Number of employees at the end of the 2020–2024 reporting period

In 2024, at the end of the reporting period, the Company had 306 employees, which is 2% less than at the end of the reporting period in 2023. Despite this, the average number of employees was 1% higher compared to 2023, while the average number of employees based on paid hours in 2024 remained unchanged compared to the previous year.

Average number of employees during the year in the 2020–2024 period Average number of employees based on hours paid in the 2020–2024 period

As at 31 December 2024, of the total number of employees, 55% were women, and 45% of the total number of employees were men. Of the total number of employees, 76% were employed for an indefinite period, representing an increase of 22% compared to the previous year, when at the end of the reporting period, 62% of employees were employed for a permanent period. According to the age structure, 50% of employees belonged to the age group of 30-50.

Employees by gender and age group as at 31/12/2024

Women Men

At the end of the reporting period, as well as in the comparison with 2022 and 2023, women had a high share of more than 50% in the total number of employees. More precisely, in 2024 women accounted for 55%, in 2023 for 51% and in 2022 for 54% of the total number of employees.

Employees by gender at the end of the 2022–2024 reporting period

Men Women

Employees by gender and employment contracts as at 31/12/2022, 2023 and 2024

As at 31 December 2024, of 306 employees, 95% were full-time employees and 5% part-time employees, thus maintaining the continuity of a high proportion of full-time employees.

Employees by gender and working hours at the end of the reporting period

Men Women

Employees by employment contracts and permanent residence at the end of the reporting period in 2022, 2023 and 2024

Employees by permanent residence on 31/12/2024

As of December 31, 2024, the largest number of employees resides in Biograd na Moru, followed by other municipalities in Zadar County, Sv. Filip i Jakov, Zadar, Benkovac and others. Only 7% are employees were from outside Zadar County, i.e. from other parts of the Republic of Croatia and abroad. In 2024, at the end of the reporting period, the Company had 15 employees from abroad, accounting for 5% of the total number of employees (306).

As at 31 August 2024, during the peak season, based on the place of residence and employment contract, employees from towns and municipalities of Zadar County were predominant, whose share is 75% of the total number of employees, while employees from other parts of the Republic of Croatia and abroad accounted for 25% of employees in the main season.

47

52

18

Permanent Fixed-term

20 23

Sv. Filip i Jakov

Sv. Filip i Jakov

29

18

8

Zadar Other in

Zadar Other in

Zadar county

37

57

52

23

Zadar county 6

36

1

Rest

14

Rest Benkovac Biograd na

85

24 27

Moru

47

18

Sv. Filip i Jakov

29

8

Zadar Other in

57

23

Zadar county 6

Rest

102

102

Employees by employment contracts and permanent residence at the end of the reporting period 31/08/2022, 2023 and 2024

Permanent Fixed-term

Permanent Fixed-term

6

67

56

6

35

Benkovac Biograd na

Moru

Employment – new employees

In 2024, compared to previous years, the ratio of newly employed and long-term seasonal workers has changed due to the increase in the number of newly employed. In the reporting period, 206 employees were hired, of which 35% were previously employed by the Company, i.e. they are long-term employees, while 65% were new employees who were employed at ILIRIJA d.d. for the first time.

The ratio between new employees and long-term seasonal employees in 2022, 2023 and 2024

The ratio between new employees and long-term seasonal workers in 2022, 2023 and 2024

Men Women

Among the new employees, 42% belonged to the age group of employees from 30 to 50 years of age, 65% of the new employees were women, while 54% of the new employees were employees from abroad.

New employees by gender in certain age group in the period from 2022 to 2024

New employees by permanent residence and age group in the 2022–2024 period

Employee turnover

In 2024, the majority of employee departures, or 90% of them, were realised by termination of fixed-term contracts. They were mainly departures of seasonal employees after the end of the tourist season in October, and only in a smaller number about departures for retirement and voluntary departures.

The Company hired the most employees in 2024 – more specifically 206, compared to 2022 and 2023, which resulted in the highest number of employee departures, a total of 212.

Employee departures and hirings in the 2022–2024 period

Employee departures in 2024 by gender and age group

Hiring Departures

Total number of employees through the year Total number of employee departures

Maternity and parental leave

In 2024, a total of 14 employees took maternity or parental leave, of which 10 were women and 4 were men. Out of the 11 employees who were to return to work in 2024 following the expiration of their parental leave, 8 of them returned, thus the return rate equals 73%. The retention rate is 88% because 7 out of 8 employees are still employed by the Company in 2025.

Maternity and parental leave

Year	Total number of employees through the year			Employees who exercised their right to parental leave		Total number of employees who returned to work after parental leave	Rate of return to work	Rate of stay
	Men	Women	Men	Women	Men	Women
2022	142	169	2	12	0	4	67%	100%
2023	152	160	2	11	1	3	67%	100%
2024	138	168	4	10	4	4	73%	88%

6.2 Diversity and equal opportunities

Ilirija d.d. is a signatory of the Croatian Diversity Charter and is recognised as a company that promotes diversity as one of its core values, while the President of the Management Board Mr Goran Ražnjević was appointed one of the ambassadors of diversity in the Republic of Croatia. In 2020, Ilirija joined the Alliance for Gender Equality, which further strengthened the direction of development of corporate values based on the principles of diversity and inclusiveness and created what Ilirija is today – a modern and accountable corporate company that values every individual through their work, commitment and desire to be part of a dynamic business system. As a public company and a responsible business system, the Ilirija bases its business activities on a policy of diversity, by hiring employees of various nationalities, races, genders, educational backgrounds, ages, levels of knowledge, experiences, etc., who are all together the key to its success. Therefore, in this regard, several women were appointed to leading positions in the organisational structure during 2024. The Company has been continually fostering diversity of its employees on the one side, and equality in all rights and respect for personal dignity of its employees on the other. Also, for a number of years, the Company has appointed commissioners for employee dignity protection who receive and resolve employee complaints.

Fundamental principles of diversity policy

1 Equal opportunities in the workplace

• for all employees 2 Zero tolerance for any form of discrimination
• 3 Motivating and stimulating business environment
• 4 Diversity of knowledge and experience
• 5 Equal pay for equal work
• 6 Croatian Diversity Charter
• 7 Gender Equality Federation 8 President of the Management Board –
• a promoter of diversity

In the Company's management consisting of the Management Board, sector managers and heads of corporate services, there are 17 persons, 71% of whom are women. The majority of management, or 76% of them, belong to the age group of 30-50, 65% have a university degree, and all come from towns and municipalities in Zadar County.

Management employees by gender, age group and education level

Material and other rights of employees

Within the Company, there are no differences in the salaries of employees by gender, age, religion, political opinion, national or social origin and any other belief or diversity for the same job.

The average gross salary in 2024 amounted to EUR 1,675.00, which is 9% more than in the previous year. The average gross salary paid for 2024 in Ilirija d.d. was 23% higher than the average gross salary paid for the same period in the industry of accommodation services and food preparation and service in the Republic of Croatia.

Average gross salary paid by Ilirija d.d. in the 2022-2024 period (EUR)

Average gross salary at the level of the Republic of Croatia (EUR)

In addition to their regular salaries, the Company provides employees with additional material and intangible benefits, including:

• one-off financial assistance and assistance through the services provided by the Company (transportation services, accommodation) for fixed-term or full-time employees in case of illness pertaining to them personally or to their immediate family members,
• a warm meal for fixed-term or full-time employees, at a symbolic price of EUR 0.13 per day,
• assistance for a newborn,
• gifts for children,
• a Christmas bonus,
• full-body health check-ups,
• co-financing of travel expenses for fixed-term and full-time employees living outside their place of work,
• accommodation and meals for employees coming from outside the Zadar County,
• education programmes, professional training and retraining courses for company employees, financed entirely by the Company, with an obligation for employees to successfully complete them within the stipulated time limit,
• the Company provides its services to its full-time employees and their immediate family members (children) either at a significant discount relative to their market price (food and beverage-related services) or free of charge (by making the premises and facilities owned by the Company available for private needs of its employees, allowing the use of work inventory, vehicles, transportation services, etc.),
• encouraging employees to do sports by providing conditions for recreational sports practice, through for example purchase of sports equipment, paying gym rental fees, etc.
• proposals of plans for education, further training and improvement according to the bottom-up model for all employees in accordance with the needs of the Company, as well as the wishes and interests of employees, and especially managers.

6.3 Training and education

The Company pays special attention to the training, education and development of our employees. Investments in human resource development is one of the principles of human resource management within the company, which results in their motivation and satisfaction, and raises their personal competencies. Training and education are an essential topic that refers to all facilities within the company in cooperation with external authorised companies as well as companies and educational institutions, which provide training for the hospitality and tourism business. The main goal of the Company is to provide and retain professional, capable and motivated employees who create new values and achieve personal and professional satisfaction. The Company strives to comply with the legal regulations and to also motivate its employees with additional knowledge, skills and access to information on the latest trends and developments in the tourism industry.

The training and education plan is prepared and approved on an annual level by the Company Management Board and in coordination with the Human Resources and Payroll Department and sector managers in part of the key business segments (food and beverage, sales and marketing, corporate service and safety service, house-keeping). The training and education plan defines the area, i.e. topics of training, employees, period, budget, and practical education, study visits and familiarization with the best examples and practices in addition to the theoretical part, if necessary, as well as presentations and implementation of new knowledge, skills and standards.

Employees or their managers are required to bring a certificate of successful completion of the education programme or, if no certificate is issued, inform the Human Resources and Payroll Department of the fact that they completed the programme.

Through training and education of our employees we strive to:

• improving existing skills and developing new employee skills,
• greater employee motivation and satisfaction,
• developing the necessary personnel,
• professional and personal development of employees,
• raising the quality of services,
• increasing guest satisfaction,
• increasing the Company's competitiveness, and
• creating a safe work environment.

At Ilirija d.d. the most common forms of training are:

• seminars,
• in-house and online workshops,
• courses,
• practical classes and exercises.

In 2024, 7,781 hours were spent on training and education, including education prescribed by the Act on Fire Protection and the Act on Health Protection. A total of 251 employees took part in education programmes, namely 114 men and 137 women, with the average number of training hours per employee being 31 hours.

Number of employees who underwent training and the number of training hours for the period 2022 – 2024

	2022	2023	2024
Number of training hours	6,356	7,688	7,781
Number of employees	227	248	251
Number of men	109	115	114
Number of women	118	133	137
Average number of ho urs per employee	28	31	31

If we do not include the education programmes prescribed by the law, the average number of training hours per employee amounted to 23 hours, that is, a total of 3958 hours was spent on training. The education included 174 employees, 77 of whom were men, with 1,916 hours of training and 97 of whom were women, with 2,042 hours of training, while the ratios are illustrated by the graph below.

The management consisting of sector managers and heads of departmental units underwent 416 hours of education. The education included 5 men and 11 women, and the average number of training hours per employee in the management category amounted to 26 hours.

Education hours by gender in 2024

Education hours of general and senior management in 2024

women men

6.4 Occupational Health and Safety

Occupational health and safety in the workplace is a material topic for the Company, and that is enforced at all its facilities because the Company's primary goal is to ensure maximum safety for its guests and employees, ensuring the conditions for providing services of a high-level standard and quality. Health and safety is carried out by the Safety Service, which ensures the health and safety of all employees and guests is provided at the Company level, and continuous education is carried out.

The security service is divided into:

• Health Control
• Occupational Health and Safety
• Fire protection

Accordingly, in terms of safety and security, the Company bases the system on:

1) monitoring all applicable legal regulations and ordinances and alignment with them,

2) development and implementation of own ordinances and policies, including the Environmental and Quality Policy;

3) development of annual plans and activities for each of these areas,

4) implementation of domestic and international standards, and

5) continuous key stakeholder trainings.

Health Control

Health and safety of guests and employees is one of the most important factors in the Company's business processes, where through optimal working conditions, regular education and appropriate equipment, it is possible to implement the standards of health protection and hygiene of accommodation facilities.

The head of Health Control at the Company level is responsible for all regulations and standards of health and safety measures, which includes internal HACCP control, control of the healthiness of drinking and pool water, organisation of DDD measures, records of hygiene of accommodation and sanitary facilities, cooperation with the state inspection during their supervision related to the proper implementation of health controls, etc. Moreover, in addition to aligning business processes with applicable legal regulations, the Company bases its safety management system on standards, including the ISO 9001:2015 quality management system, the Company – Friend of Health certificate and by implementing the certifying the HACCP system.

In the health and safety management system, we monitor and comply with the following legal requirements and policies:

(1) Legal regulations: Catering Activity Act (OG 85/15, 121/16, 99/18, 25/19, 98/19, 32/20, 42/20, 126/21 and 152/2024), Act on General Use Items (OG 39/13, 47/14, 114/18 and 53/22), Act on Protection against Non-Ionizing Radiation (OG 91/10 and 114/18), Nature Protection Act (OG 80/13, 15/18, 14/19, 127/19 and 155/23), Construction Act (OG 153/13, 20/17, 39/19, 125/19 and 145/24), Noise Protection Act (OG 30/09, 55/13, 153/13, 41/16, 114/18 and 14/21), Chemicals Act (18/13, 115/18 and 37/20), Occupational Safety Act (OG 71/14, 118/14, 154/14, 94/18 i 96/18), Fire Protection Act (OG 92/10 and 114/22), Labour Act (OG 93/14, 127/17, 98/19, 151/22, 46/23 and 64/23), State Inspectorate Act (115/18, 117/21, 67/23 and 155/23), Food Act (OG 18/23), Act on the Protection of the Population from Infectious Diseases (OG 79/07, 113/08, 43/09, 130/17, 114/18, 47/20, 134/20 and 143/21).

2) Ordinances: Ordinance on Special Conditions for the Production and Marketing of General Use Items (OG 80/18), Ordinance on Food Hygiene (OG 99/07, 27/08), Guide to Microbiological Criteria for Food, March 2011, Ordinance on Occupational Safety Regarding the Use of Work Equipment (OG 18/17), Ordinance on the Testing of the Working Environment (OG 16/16), Ordinance on the Inspection and Testing of Work Equipment (OG 16/16), Ordinance on Safety Signs (OG 91/15, 102/15), Ordinance on the Sanitary-Technical and Hygienic Conditions for Swimming Pool Bathing Areas and on the Health Safety of Swimming Pool Water (OG 59/20).

3) Implementation of international and national management systems including the ISO 9001:2015 quality management system, the Company – Friend of Health certificate, the HACCP certificate, Safe Stay in Croatia.

In terms of health control, the Company is focused on achieving a high level of safety and health, which means:

• ensuring safe and healthy working conditions,
• fulfilling legal regulations and other requirements in the field of health and safety,
• elimination of hazards and reduction of health and safety risks at work,
• permanent improvement of occupational health and safety management,
• a healthy and safe environment for guests to stay,
• ensuring the responsibility and authority of employees at all levels of the occupational health and safety management system, and
• continuous education of employees in order to acquire knowledge in the field of health and safety.

Health control activities in 2024:

Activities in the field of health and sanitary safety 1

Sanitary and health safety and food safety, the organisation of sanitary and health safety in hotels is primarily reflected in the control of water quality, temperature and hygienic and sanitary supervision of kitchens.

The hygiene and sanitation segment covered the facility's equipment and functionality, lighting and ventilation, maintenance of accessories and equipment, cleaning and disinfection, removal of waste materials and care for employees' personal hygiene. The health control also covered the laundry service and compliance with all health and sanitary regulations.

Sanitary and health safety as an extremely sensitive part of the business process where the responsibility of all employees is expected, as well as the responsible behaviour of guests during their stay in the hotel. Regular controls and inspections by competent authorities contribute to the prevention and quality of the hotel's sanitary and health safety. In 2024, the Sanitary Inspection at the State Inspectorate conducted one supervisory control in a food production facility. All inspections confirmed that the facility operated in compliance with the law.

In 2024, HACCP system was recertified at all hospitality facilities, in compliance with the Codex Alimentarius standard, as a control/monitoring system of critical control points in foodstuff handling procedures. Regular inspections of hospitality facilities (restaurants, bars and kitchens) were performed and all processes were audited, analysing potential hazards, identification of control points and critical control points in operation, employee hygiene inspection, implementation of DDD measures, water safety inspections and continuous education of employees. In 2024, the Sanitary Inspection at the State Inspectorate conducted one supervisory control in a food production facility. All inspections confirmed that the facility operated in compliance with the law.

The control of the cleanliness of accommodation facilities is carried out in accordance with the stipulated standard on a weekly and monthly basis within each individual facility and sanitary facilities. This was entered in the records as part of quality management. Housekeepers and maids were trained, laundry presentation workshops and a course on instructions for working with the new device and cleaning products were held.

The health safety of the pool water

Together with the Croatian Institute of Public Health, the safety of the pool water of all pools was analysed according to the sampling plan. The following was performed on a daily basis: controlling water quality parameters (chlorine concentration and pH value), keeping a record of swimming pool maintenance and hygiene inspections, implementing sanitation procedures in accordance with Swimming Pool and Engine Room Cleaning Plan, regular sampling of pool water by a licensed laboratory, regular chlorination of pool water in order to maintain its safety, employee education on handling chemicals and monitoring their consumption.

In order to maintain the hygiene of the wellness area, actions were taken to clean the wellness rooms, regularly check the health safety of the water in the jacuzzies, disinfect them, check the hygiene of the filters, check the items for general use, check and declare the products that were used, conduct employee training and check the measurement of the ionizing radiation in the tanning room by an authorised company.

6

Implementation and control of application of national and international standards related to health control

In the health and safety management system, we monitor and comply with all applicable legal requirements and policies. In 2024, as part of the "Company – Friend of Health" certificate, which was first awarded in 2018, as part of the ""Healthy Living" project launched by the Croatian Institute of Public Health, health education lectures and workshops were held for the Company's employees with the aim of promoting health in the workplace and work environment, as well as the Workplace Health Week, which, with the support of the Zadar County Health Centre and the Institute of Public Health, provided employees with free blood pressure, sugar, body weight and BMI index measurements.

Sanitary and hygienic as well as microbiological sampling of food and water in 2024

Groups:	Total samples		Chemical analysis performed		Microbiological analysis performed	Defective samples
Sup. group		Total	Defective	Total	Defective
Grand total:	126	42	3	120	2	2
1 Food	16	0	0	16	0	0
2 Swabs	4	0	0	4	0	0
3 Drinking water	31	31	0	31	0	0
4 Other water	5	5	0	5	0	0
5 Sea and pool water	40	0	0	40	0	0
6 Waste water	6	6	3	0	0	0
7 Dipslide	185	0	0	185	2	2

Health in the workplace

The Company aims to ensure the maximum safety and health of our employees in their workplace. Therefore, it takes actions, which include:

• Assessing the risks to health and safety,
• Ensuring that each employee is properly trained in terms of health and safety protection,
• Encouraging communication with employees,
• Keeping a record of injuries at work,
• Taking correcting actions if necessary.

Risk assessment is the basis for occupational safety and health management, which enables the identification of possible events that could cause unintended consequences. The Company's risk assessment process regarding occupational health and safety is based on:

• collecting data at the workplace
• analysing and evaluating the collected data, which includes:
• identification of dangers, harm and strain,
• assessment of dangers, harm and strain, and
• establishing the plan of measures for the removal or reduction of danger, harm and strain levels, which shall include deadlines.

For all employees of the Food and Beverage Department, as well as employees of other departments who are subject to mandatory health supervision, we perform sanitary and hygienic examinations and meet the legal provisions regarding the possession of sanitary cards, which confirm that the employees are healthy and able to work. Internal training is provided by the Heads of Health Control and Occupational Safety and Fire Protection, in cooperation with external authorized companies and the Institute of Public Health. At the Institute of Public Health, 48 employees attended the Health Education course. Internal trainings on the HACCP system were held in the same manner for the employees of the Food and Beverages Department.

The plan and program of specific employee health care measures are organized on an annual basis at the level of primary health care, and the plan is implemented taking into account the employees' working conditions as well as the dangers, harm and strain they are exposed to in carrying out their tasks. Following the established methodology for carrying out examinations and tests, especially functional tests of organs and organ systems, examinations are carried out to assess the employees' working abilities against the demands of jobs with special working conditions. Examinations are carried out by occupational medicine specialists, and according to the type of examination, by a haematology and biochemistry laboratory, toxicology laboratory, psychologist, other specialists with the aim of reducing possible injuries at work.

Occupational medicine check-ups

	2022	2023	2024
Nautics	32	16	27
Camping	9	3	0
Laundry	6	0	12
Techincal sevice	17	7	16
Horticulture	14	4	5
Total	78	30	60

The reason for the increase in the number of occupational medicine examinations is the fact that certain types of medical examinations are valid for two years, and therefore they were carried out in 2024, which increased the number of examinations compared to 2023.

Along with complying with legal regulations and implementing ordinances, the Company also carries out additional activities related to the health and safety of employees and guests:

• it implemented the HACCAP system to guarantee a high level of control, quality and safety in the process of preparation, production and distribution of food and beverage services, while taking into account the diversity of the diet and its nutritional value,
• it provided information by labelling food allergens,
• evacuation and rescue plans are present in all facilities, in visible places,
• it applies the methodology of cleaner production,
• it implements complete measures for the destruction of micro-organisms and pest control in accordance with legal regulations and in cooperation with authorized external companies,
• it tests the quality of sea waters,
• it tests pool water for physical, chemical and microbiological parameters,
• information has been provided and trainings have been held on the importance of preservation of natural resources (preservation and protection of water, energy, waste disposal, etc.),
• it implements DDD measures,
• a safe working practice for the use of chemicals was introduced,
• suppliers with the fairtrade and sustainable certification marks are selected when purchasing linen,
• it introduced the practice of avoiding individual packaging of food and beverage products, as well as of laundry detergent, and
• it selects products that are environmentally friendly or have minimal environmental impact.

Occupational Health and Safety

According to data on the internal organisation and systematization of workplaces, in a company with more than 250 permanent employees, it means that safety at work is a key part of business planning and management and social responsibility. By applying the rules, principles, measures, procedures and activities of the Occupational Safety and Health Service, the Company strives to ensure and improve health protection and safety at work, both for employees and all guests and visitors. The goal is to prevent risks, injuries at work, occupational diseases, work-related illnesses and other material and non-material damages at work and in connection with work.

In addition to the above, protection at work also includes protection from mechanical installations, protection from electric shocks, protection from noise and vibrations, protection from harmful atmospheric and climatic influences, protection from physical, chemical and biological harmful effects, protection from excessive exertion, and prevention of fire and explosions. The Company is obliged to implement safety at work and provide the employee with conditions for safe work. All activities with regard to Occupational Health and Safety have been performed in compliance with legislation governing occupational health and safety and the Ilirija d.d. Plan of Measures for Occupational Health and Safety, with a continuous monitoring of new regulations, their implementation and relevant employee training.

In the health and safety management and fire protection system, we monitor and comply with the following legal requirements and policies:

Legal regulations:

Occupational Safety Act ("Official Gazette" No. 71/14, 118/14, 154/14, 94/18 and 96/18), Fire Protection Act ("Official Gazette" Nos 92/10 and 114/22) Labour Act ("Official Gazette" Nos 93/14, 127/17, 98/19, 151/22, 46/23 and 64/23) Compulsory Health Insurance Act ("Official Gazette" No. 80/13, 137/13, 98/19 and 33/23), Noise Protection Act ("Official Gazette" Nos. NN 30/09, 55/13, 153/13, 41/16, 114/18 and14/21) Act on the List of Occupational Illnesses ("Official Gazette" No. 162/98 and 107/07), Health Protection Act ("Official Gazette" No. 100/18, 125/19, 147/20, 119/22, 156/22, 33/23 and 36/24).

1

Ordinances:

Ordinance on the Fire Protection Plan (Official Gazette, No 51/12) Fire Protection Ordinance ("Official Gazette" No. 100/99)

Internal ordinances:

Ordinance on Occupational Health and Safety, Fire Protection Ordinance, Risk Assessment and Evacuation Plans

3

The Occupational Safety and Fire Protection Manager is in charge of organizing and directly managing occupational safety, namely in order to protect both the company and the life and health of employees and all citizens in the area where the company does business. The commissioners for occupational safety activities and the Occupational Safety Committee jointly perform monitoring activities and consultations on occupational health and safety protection programmes. The performance of individual occupational health and safety tasks is entrusted to authorised legal entities.

The following occupational health and safety activities have been performed in 2024:

Education and information of employees in the field of safe work and minimum fire protection is carried out, conducting educational training activities for providing first aid, securing means and equipment as well as medical examinations of workers at workplaces with special working conditions.

Occupational injury record-keeping

Keeping records of employees who suffered an injury or illness in the workplace. Three minor occupational injuries were recorded in 2024.

Control of instruments of work and working environment

Testing of instruments of work and working environment by a licensed company, testing of all machines and devices used for work with an increased risk of occupational hazards, electrical and lightning protection installations and the working environment, referring employees to periodically and daily inspect the serviceability of instruments of work.

In order to ensure health supervision suitable to hazards, harm and strain during work, for the preservation of employee health, the Company provided the employees at positions with special working conditions with occupational healthcare services in accordance with relevant legislation at the licensed medical institution competent for occupational medicine. During 2024, 60 periodic examinations were performed for employees at workplaces with special working conditions, in addition to additional annual sanitary examinations of employees at the Institute of Public Health, and 33 eyesight examinations of employees at administrative positions (working with computers).

Employee training activities for safe work practices in accordance with the training programme based on a previously prepared risk assessment, which includes all occupational hazards, harms and efforts determined by the risk assessment and ways to eliminate them. During 2024, 58 employees completed safe work training as well as minimum fire protection training, of which 24 were foreign employees who successfully completed the training according to the adapted programme.

Implementation of occupational health and safety measures

Implementation of occupational health and safety measures in order to improve working conditions, prevent occupational injuries and illnesses, other work-related illnesses and the protection of the working environment, which include the following technical and organisational measures: testing of machines and devices used for work with increased risk of occupational hazards, electrical installations, lightning protection – lightning rods, microclimate and lighting in accordance with regulations governing respective areas, fire extinguisher inspections, fire hydrant network inspections, inspections of fire alarm and extinguishing systems, as well as fire fighting equipment in fire hydrant cabinets; control of instructions for safe work practices and hazard signage, and implementation of internal supervision of compliance with occupational health and safety rules.

Practice evacuation and rescue drills when implementing fire protection and employee rescue measures, which must be carried out biannually in accordance with relevant legislation. During 2024, the four aforementioned drills were held in four different sectors, and new drills are planned for 2025 in cooperation with external authorised companies.

Practical drills Activities of the Occupational Health and Safety Committee

For the purpose of improving occupational health and safety, the Occupational Health and Safety Committee planned and supervised the implementation of occupational health and safety rules, organised the performance of occupational health and safety tasks, informed and trained employees on occupational health and safety, implemented the prevention of occupational risks and their effects on employee health and safety.

Fire protection

In order to protect people's lives and property, measures and actions are taken in order to eliminate the causes of fire, prevention of occurrence and spreading of fire, fire detection and extinguishing, identifying causes of fire, as well as providing assistance with eliminating fire damage.

Fire protection measures are organised and implemented in accordance with the Fire Protection Act, other regulations and the Fire Protection Ordinance.

The fire protection plan of Ilirija d.d. governs the actions undertaken by fire brigades and other participants in the fire-fighting activity, and the plan itself is adjusted after each fire hazard assessment, i.e. within the deadlines set by the Fire Protection Act.

The fire protection service, through organisational and preventive measures, prevents risks and dangers that can arise and cause the occurrence of fires, thus contributing to the protection of life, health and safety of people as well as property and the environment. The following measures are undertaken at Company level:

• testing and maintenance of electrical and gas installations,
• regular cleaning of chimneys and ventilation ducts,
• testing of the hydrant network,
• annual inspection of fire extinguishers,
• maintenance and inspection of boiler rooms, and areas where dangerous substances and liquids are stored and used,
• Installation and maintenance of devices, equipment, installations and fire alarm and extinguishing systems,
• maintenance of fire brigade entry points, and
• carrying out evacuation drills in case of an emergency.

The following occupational health and safety activities have been performed in 2024

Procurement of equipment and its serviceability

Procurement of required fire protection equipment and a sufficient number of fire extinguishers. The Company has installed 371 fire extinguishers in all facilities. Additional safety and protection were provided by purchasing a fireboat with special equipment and a foam fire extinguisher and a crew that completed a fire-fighting intervention course. Nineteen employees completed a volunteer fire fighter training.

Daily supervision of the implementation of fire protection measures by the Department Manager and/or employees at each facility. Periodic supervision of implementation of fire protection measures by immediate managers and the Occupational Safety and Fire Protection Manager.

In 2024, in the field of fire protection, 2 inspections were carried out with regard to the implemented measures, establishing the regularity of the implementation.

Activities in fire protection programmes

The Company actively engaged in the implementation of the Activity Programme for the Implementation of Special Fire Protection Measures in so far as it complies with the guidelines issued by the County Chief Fire Officer and the Biograd Public Fire Brigade. The Fire Protection Department requested from the Biograd na Moru water distributor to update the information on the public fire hydrant network (fire hydrant position and serviceability).

Training for safe work practices

Year	2022	2023	2024
Training for safe work practices	26	64	58

Based on the risk assessment, we train our employees to work in a safe manner, which is done by our Head of Occupational Safety in cooperation with occupational safety experts authorized to perform the training.

Fire drills

Year	2022	2023	2024
Number of fire fighting drills	4	4	4

We conduct fire safety and evacuation exercises every year, namely at the level of all sectors and with all employees within a sector participating. We would like to highlight a practical fire safety drill was held in Marina Kornati, where a fire simulation demonstrated the possible hazards, that is, the measures and procedures that need to be taken in extraordinary circumstances.

Number of fire extinguisher inspections

Year	2022	2023	2024
Number of fire extinguisher inspections	391	391	371

Maintenance of fire extinguishers is carried out through regular inspections and periodic servicing. Fire extinguishers are inspected and tested in accordance with the regulations for pressure equipment. Inspections are performed by a registered fire fighting servicing department.

Occupational health and safety training, safety equipment inspections and occupational injuries

Occupational safety and fire safety managers carry out education and training as well as medical examinations of employees in order to reduce the number of work injuries, occupational illnesses or any other health issues to a minimum. The managers shall send each employee to Safe Work Training as well as Minimum Fire Protection Training, and the employee shall attend them. Safety is also increased by conducting fire safety and evacuation drills, where employees demonstrate the knowledge they have acquired during training. The managers shall maintain the fire extinguishing equipment so that it is functional and tested within the given deadlines.

In order to increase the safety of our employees and all visitors, employees are also trained in the use of resuscitation devices, defibrillators, which are installed in our facilities. Furthermore, sector managers were additionally trained in providing first aid, where they received additional know-how on how to help victims in different situations.

	2022				2023				2024
	Number of injuries	Number of professional diseases	Number of lost days	Number of fatalities	Number of injuries	Number of professional diseases	Number of lost days	Number of fatalities	Number of injuries	Number of professional diseases	Number of lost days	Number of fatalities
Men	1	0	30	0	3	0	35	0	1	0	6	0
Women	1	0	67	0	5	0	352	0	2	0	70	0
Total	2	0	97	0	8	0	387	0	3	0	76	0

The rates of injuries, occupational diseases, lost work days and absences, and the number of fatalities related to accidents at work

Injury rate parameters

Parametar	2022	2023	2024
IR (injury rate)	0,61	2,29	0,93
ODR (occupational disease rate)	0	0	0
LDR (lost daily rate)	0,3	0,287	0,22
AR (absentee rate in case of fatalities)	0	0	0

6.5 Indirect Impacts of the Company and the Community

Corporate philanthropy

Significant contributions to the wider community are implemented through the corporate philanthropy system, i.e. donations and sponsorships, with a special emphasis on focusing the philanthropic activities mainly on the area of its regional community (Zadar County).

Corporate philanthropy is carried out in three ways:

• by initiating or participating in the donation/sponsorship process pertaining to specific social projects together with other members of the community;

• through continuous donation to various associations, sports clubs, educational institutions, religious institutions, individuals, young people and the culture, namely with an emphasis on the preservation and restoration of the cultural and historical heritage, etc., based primarily on an assessment of their importance and impact on long-term community development, on the degree of innovation, on the concern for environmental protection and conservation, the contribution to education, the promotion and preservation of the culture and tradition of the area and the impact on children and young people; and

• through donations/sponsorships in response to the current needs of the community, or through the so-called ad hoc donations/sponsorships.

In 2024, the Company supported activities, projects and individual requests through the corporate philanthropy system, namely in the following areas:

I. culture, II. humanitarian programme, III. science-education, IV. sports, and V. society.

In 2024, through the system of corporate philanthropy, the Company supported numerous projects, campaigns, the work of various associations, institutions, clubs, business associations, etc. in the total amount of EUR 68,632.37.

During 2024, the Company organised and/or supported numerous events of special importance for the development of the destination and its tourist offer, events of importance at the national level, as well as a number of projects and activities through the system of corporate philanthropy, of which we particularly highlight:

• Biograd Boat Show,
• Numerous cultural and entertainment facilities in the Arsenal and Beach Club Ilirija,
• Cultural and art associations (local cultural and art associations) in the promotion of culture, customs and traditions of the Zadar region,
• "Škraping Pašman" international trekking race,
• 309 Sinjska alka, a unique chivalric tournament under UNESCO protection,
• Celebrating the World Health Day, as well as the International Nurses Day with the help of professors and students of the Ante Kuzmanić Medical School through public actions to measure blood pressure and blood sugar for all interested visitors to the centre,
• Multiannual cooperation with the Centre for Education, Counselling and Humanitarian Action "Krugovi" in the organisation of humanitarian activities aimed at collecting donations for children, young people and adults suffering from malignant diseases,
• Multi-year cooperation with the "Voli Život" ("Love Your Life") Humanitarian Organisation, which takes care of severely ill and socially vulnerable children across Croatia by means of financial donations for purchase of aids, help with payment of medications and surgery abroad and in the country,
• Humanitarian action "Slatki zalogaj za velike pobjede (Sweet bite for great victories)" organised by the charitable organisation Caritas of the Zadar Archdiocese and the Home for adults "Sv. Frane" Zadar with the purpose of raising funds for Mali Princ Sports Association for Persons with Intellectual Disabilities,
• Holding a public health campaign in cooperation with the Cukrići Association Zadar in cooperation with students and teachers of the Hotel, Tourism and Catering High School and the Medical High School,
• Presentation of the products of the Student Cooperative "Vridne ruke" as part of the humanitarian projects of the Stanko Ožanić Agricultural, Food and Veterinary School Zadar,
• Holding the Christmas humanitarian campaign of the Ante Kuzmanić Medical School through the collection of donations to help local students and selected schools, along with the presentation of students' creative works and handicrafts,
• Donation for the interior decoration of the Church of the Sacred Heart of Jesus in Neviđani,
• Support of the Association for Culture and Art "IN FLUX U pokretu" in organizing the annual event UR-BAN JAM 023 in the City Galleria Centre,

• Support for the 15th international swimming meeting "Sv. Krševan" organised by the "Zadar" Swimming Club at the Višnjik sports centre,
• Support for the taekwondo club for persons with disabilities "Donat Zadar" in organising the 4th international parataekwondo and taekwondo competition in Zadar,
• Sponsorship of the "Zadar Christmas Run 2024" fun sports and humanitarian Christmas race with the association TRIATHLON CLUB ZADAR,
• Lifelong Learning Fair in cooperation with the Zadar High School for Economics, Office Management and Commerce,
• The organisation of the Advent celebration at City Galleria, with an entertainment programme for children and welcoming of St Nicholas, including numerous creative workshops, a puppet show and welcoming of Santa Claus, as well as Christmas gifts for the little ones,
• Performance of the GESTA Dance Association entitled "Uskrsni plesni kolaž (Easter Dance Collage)" with over 100 young dancers of different ages,
• Support for a series of cultural, sports and entertainment events at the destination level.

6.6 Marketing and Labelling

Proper labelling and informing customers about the food and beverages they consume is a material topic for the Company, considering that the health and safety of food is an extremely important segment of the Company's business. The Ordinance on Consumer Information about Non-Prepacked Food (OG 144/14, 64/20 and 144/20) provides for mandatory information on the presence of substances or products that may cause allergies or intolerances. EU legislation lists 14 specific allergens used in the preparation of food (including beverages) that are present in the finished product. We inform our guests of the presence of allergens in the food served on the buffet table in hotels or during banquets by clearly displaying allergen pictogrammes, while noticeable and clearly legible messages are placed in à la carte restaurants, inviting consumers to ask the staff for information regarding the presence of substances or products that can cause allergies or intolerances.

The Food and Beverages Department staff were educated about the importance of properly informing guests of the presence of allergens and of their possible adverse health effects. The management of substances or products that may cause allergic reactions or intolerance is monitored internally by the Health Control Manager and by external supervisory bodies such as the sanitary inspection or accredited HALAL or HACCP system auditors.

In 2024, we did not record any breaches of regulations, nor did we receive any complaints regarding breaches of regulations pertaining to product labelling. All kitchens of the Company have successfully implemented the Food Safety Management System (HACCP) and all food handling practices are carried out in accordance with the principles and guidelines of the Good Manufacturing Practice (GMP) and Good Hygiene Practice (GHP). By doing so, we systematically contribute to the safety of the food served in our facilities.

SUSTAINABILITY REPORT FOR THE YEAR 2024